Current Attempt in Progress Presented below are two independent situations: Click here to view factor tables (a) On January 1, 2020, Headland Inc. purchased land that had an assessed value of $347,000 at the time of purchase. A $558,000, zero-interest-bearing note due January 1, 2023, was given in exchange. There was no established exchange price for the land, nor a ready fair value for the note. The interest rate charged on a note of this type is 12%. Determine at what amount the land should be recorded at January 1, 2020, and the interest expense to be reported in 2020 related to this transaction. (Round answers to O decimal places, e.g. 38,548.) Land to be recorded at January 1, 2020 $ Interest expense to be reported $ (b) On January 1, 2020, Sage Furniture borrowed $4,300,000 (face value) from Sinise Co., a major customer, through a zero-interest- bearing note due in 4 years. Because the note was zero-interest-bearing, Sage Furniture agreed to sell furniture to this customer at lower than market price. A 10% rate of interest is normally charged on this type of loan. Prepare the journal entry to record this transaction. (Round answers to O decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit Determine the amount of interest expense to report for 2020. (Round answer to O decimal places, e.g. 38,548.) On January 1, 2020, Culver Company makes the two following acquisitions. 1. 2. Purchases land having a fair value of $150,000 by issuing a 5-year, zero-interest-bearing promissory note in the face amount of $252,759. Purchases equipment by issuing a 6%, 9-year promissory note having a maturity value of $180,000 (interest payable annually). The company has to pay 11% interest for funds from its bank. (a) (b) Record the two journal entries that should be recorded by Culver Company for the two purchases on January 1, 2020. Record the interest at the end of the first year on both notes using the effective-interest method. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to O decimal places e.g. 58,971. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) No. Date Account Titles and Explanation (a) 1. January 1, 2020 Land Discount on Notes Payable Notes Payable 2. January 1, 2020 Equipment Discount on Notes Payable Notes Payable (b) December Interest Expense 1. 31,2020 Discount on Notes Payable December 2. Interest Expense 31, 2020 Interest Payable Discount on Notes Payable Debit 150000 102759 Credit 252759 180000