At the beginning of the year, Lambert Motors issued the three notes described below. Interest is paid at year-end.

1. The company issued a two-year, 20%, $700,000 note in exchange for a tract of land. The current market rate of interest is 20%.
2. Lambert acquired some office equipment with a fair value of $142,999 by issuing a one-year, $156,000 note. The stated interest on the note is 10%. The current market rate of interest is 20%.
3. The company purchased a building by issuing a five-year installment note. The note is to be repaid in equal installments of $1 million per year beginning one year hence. The current market rate of interest is 20%.