Record the interest and the amortization of the discount

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Question - Non-interest-Bearing Note

On January 1, 20X5, Bird Company sold goods to Dog Company. Dog signed a non interesting-bearing note requiring payment of $60,000 annually for seven years. The first payment was made on January 1, 20X5.

The prevailing rate of interest for this type of note at date of issuance was 10%.

Required

1. Record the sale of goods on Jan. 1 20X5

2. Record the first payment on Jan. 1 20X5

3. Record the interest and the Amortization of the discount on the note at December 31, 20X5.

Reference no: EM131877192

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