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On January 1, 2018, Brown Co. borrowed cash from First Bank by issuing a $57,500 face value, four-year term note that had an 6 percent annual interest rate. The note is to be repaid by making annual cash payments of $16,594 that include both interest and principal on December 31 of each year. Brown used the proceeds from the loan to purchase land that generated rental revenues of $29,325 cash per year.

3. Prepare an income statement, a balance sheet, and a statement of cash flows for each of the four years.