Sily Machine, Inc. contracted with Funny Bulder Corporation to have constructed a custom-made lathe. The machine was completed and ready for use on January 1,2021. Silly Machine paid for the lathe by issuing a $370,000 note due in three years. Interest, specified at 4%, was payable annually on December 31 of each yeat. The cash market price of the lathe was uniknown, It was determined by comparison with similar transactions that 8% was a reasonable rate of interest, and therefore the note was made at an unrealistic interest rate. Silly Machine uses the effective interest method of amortization. (EV of \$1, PV of S1, EVA of \$1, PVA of S1, EVAD of S1 and PVAD of SD) (Use approprlate factor(s) from the tables provided.) Required: 1. Prepare the journal entry on January 1, 2021, for Silly Machine's purchase of the lathe. 2. Prepare an amortization schedule for the three-year term of the note. 3. Prepare the journal entries to record (a) interest for each of the three years and (b) payment of the note at maturizy. Complete this question by entering your answers in the tabs below. Prepare the journal entry on January 1, 2021, for Holly Springs' purchose of the lathe, (If no entry is required for a transactionvevent, select "No fournal entry required" in the first account field.)