Amber Mining and Milling, Inc., contracted with Truax Corporation to have constructed a custom$-$made lathe. The machine was completed and ready for use on January $1,2021.$ Amber paid for the lathe by issuing a $$600,000,$ three$-$year note that specified $4\%$ interest, payable annually on December $31$ of each year. The cash market price of the lathe was unknown. It was determined by comparison with similar transactions that $12\%$ was a reasonable rate of interest. $(EV$ of $$1,$ PV of $$1,$ FVA of $$1,$ PVA of $$1,$ FVAD of $$1$ and PVAD of $$1)($Use appropriate factor$($s$)$ from the tables provided.$)$

Required:

$1-$a$.$ Complete the table below to determine the price of the equipment.

$1-$b$.$ Prepare the journal entry on January $1,2021,$ for Amber Mining and Milling's purchase of the lathe.

$2.$ Prepare an amortization schedule for the three$-$year term of the note.

$3.$ Prepare the journal entries to record $($a$)$ interest for each of the three years and $($b$)$ payment of the note at maturity.

Complete this question by entering your answers in the tabs below.

Req $2$

Req $3$

Complete the table below to determine the price of the equipment. $($Round final answers to the nearest whole dollars.$)$

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