Foster Company purchased a machine in exchange for a non-interest-bearing note

having a face amount of $32,000 and payable in four annual installments of $8,000

each. The note does not trade on an open market. Recent exchanges involving the

same type of equipment indicate that the machine could have been purchased for

$25,000 cash. Based on these facts, determine the amount to record as the cost of

the machine and prepare the related journal entry.