During Year $1,$ Thomas Company entered into two transactions involving promissory notes and properly recorded each transaction.

$1.$ On November $1,$ it purchased land at a cost of $$8,000.$ It made a $$2,000$ down payment and signed a note payable agreeing to pay the $$6,000$ balance in $6$ months plus interest at an annual rate of $10\%.$

$2.$ On December $1,$ it accepted a $$4,200,3-$month, $12\%($annual interest rate$)$ note receivable from a customer for the sale of merchandise. On December $31,$ Thomas made the following related adjustments: