Cambria Limited took a $250,000 two-year note receivable from a customer in connection with a major inventory sale transaction on 1 January 20X5. The note required annual end-of-year interest payments of 8%, and the principal was due at the end of 20X6.

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2. Assume now that the market interest rate is 12%. Calculate the present value of the note, and prepare a schedule that shows the annual interest. (Round time value factor to 5 decimal places and final answers to the nearest whole dollar amount. Enter all answers in positive.) Present value S 233,099 Opening Net Interest Interest Paid/ Discount Liability Expense/Revenue Received Receivable Amortization S 233,099 $ 27,972 s 20,000 $ 7,972 S 241,071 28,929 20,000 8,929 Closing Net Liability/ Receivable S 241,071 250,000 5. Prepare journal entries to record the initial sale transaction and each payment on the books of the customer who bought inventory and owes the note, consistent with requirement 2. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round time value factor to 5 decimal places and final answers to the nearest whole dollar amount.) View transaction list View journal entry worksheet No General Journal Debit Credit 1 Date 1 January 20x5 Cash Notes payable 250,000 250,000 2 31 December 20X5 Interest expense Cash 3 3 31 December 20X6 Notes payable Cash