The company purchased a piece of equipment. Terms of the purchase were as follows: $10,000 in cash immediately, followed by note payments of $20,000 at the end of each year for the next eight years. The market rate of interest is 9%.

Make the journal entry necessary to record the initial purchase. Round all answers to the nearest whole dollar.

Make the journal entries necessary to record the first cash payment of $20,000 at the end of the first year. Round your answers to the nearest whole dollar.