Harold Corporation sold land having a fair market value of $1,400,000 in exchange for a 10 year non-interest bearing promissory note in the face amount of $3,022,488. Harold Corporation purchased the land for $800,000 ten years ago. The customer purchasing the land from Harold Corporation would normally be required to pay 9% interest.

1.Record the sale on Harold Corporations books.

2.Prepare any adjusting entry required at the end of the first year.