On December 31, 2020, Kovak Co. performed environmental consulting services for Hayduke Co. Hayduke was short of cash, and Novak Co. agreed to accept a $344,200 zero-interest-bearing note due December 31, 2022, as payment in full. Hayduke is somewhat of a credit risk and typically borrows funds at a rate of 10%. Kovak is much more creditworthy and has various lines of credit at 7%.

(a) Prepare the journal entry to record the transaction of December 31, 2020, for the Kovak Co.