Hager Company acquires a computer from Volusia Computer Company. The cash price (fair value) of the computer is $37,938. Hager Company gives a three-year, interest-bearing note with a maturity value of $40,000. The note requires annual payments of 6% of face value, or $2,400 per year, payable at the end of each year. The interest rate implicit in the note is 8% per year.

a. How do you make an amortization schedule for the note using excel. What are the formulas to input?

b. What do the journal entries for Hager Company over the life of the note look like. (Ignore entries for depreciation expense on the computer. )