Lily Company performed services for a customer on January 1, 20x1 and accepted a four-year, $70,000, noninterest-bearing note. The note requires the customer to make 4 annual payments of principal and interest in the amount of $17,500 each. The first payment is due on December 31, 20x1 and each December 31st thereafter. Assuming a market rate of 5%, determine:



Question 1: Service revenue recognized upon issuance of the note

Question 2: Total interest revenue recognized over the term of the note.