Precision Castparts, a manufacturer of processed engine parts in the automotive and airline industries, borrows $$40$ million cash on October $1,2024,$ to provide working capital for anticipated expansion. Precision signs a one$-$year, $8\%$ promissory note to Midwest Bank under a prearranged short$-$term line of credit. Interest on the note is payable at maturity. Each company has a December $31$ year$-$end.

Required:

$1.$ Prepare the journal entries on October $1,2024,$ to record $($a$)$ the notes payable for Precision Castparts and $($b$)$ the notes receivable for Midwest Bank.

$2.$ Record the adjusting entry on December $31,2024,$ for $($a$)$ Precision Castparts and $($b$)$ Midwest Bank.

$3.$ Prepare the journal entries on September $30,2025,$ to record payment of $($a$)$ the notes payable for Precision Castparts and $($b$)$ the notes receivable for Midwest Bank.