1. Zello Corporation purchased a delivery truck for $400,000 on September 1, 2019, by paying 20% down payment in cash and for the balance amount signed a 5%, 10-month note payable for the balance amount. Interest and principle will be paid back together at the end of the note.

Prepare journal entries to record: (14 Marks)

1. the purchase of the delivery truck,
2. the adjusting journal entry to record the accrued interest on December 31,
3. and the payment of the note at maturity along with the interest.

2. On January 1, 2020, Zello Corp. issued $250,000 face value, 5-year bonds, with a coupon rate of 7.5%. Coupon is paid semi-annually on June 30 and December 31 each year. Prepare the necessary journal entries to record the: (6 marks)

1. issuance of the bonds on Jan 1, 2020
2. payment of first coupon payment on June 30, 2020.