On August 1, 2020 Virgin Galactic Inc. provided space travel tours in exchange for a 5 year, non-interesting bearing promissory note, with a face value of $1,000,000. Virgin Galactic reports under IFRS. The market interest rate is 8%. Determine the present value of the note and prepare the journal entry to record the transaction on August 1, 2020.

B) Prepare the adjusting journal entry as at December 31, 2020 (assuming a December 31 fiscal year-end)

Assuming Virgin Galactic reports under ASPE and uses the straight-line method to amortize the discount or premium of the note. What would the interest income or expense be at December 31, 2020? If it is an expense please enter as a negative number.