Cardinals Corporation purchased a computer on December 31, 2013, for $250,740, paying $71,640 down and agreeing to pay the balance in five equal installments of $35,820 payable each December 31 beginning in 2014. An assumed interest rate of 10% is implicit in the purchase price.

Prepare the journal entry at the date of purchase.

Prepare the journal entry at December 31, 2014, to record the payment and interest (effective interest method employed).

Prepare the journal entry at December 31, 2015, to record the payment and interest (effective interest method employed).