Record the two journal entries that should be recorded

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Question - On July 1, 2017, Grouper Inc. made two sales.

1. It sold land having a fair value of $918,380 in exchange for a 4-year zero-interest-bearing promissory note in the face amount of $1,394,168. The land is carried on Grouper's books at a cost of $592,400.

2. It rendered services in exchange for a 5%, 8-year promissory note having a face value of $404,520 (interest payable annually).

Grouper Inc. recently had to pay 8% interest for money that it borrowed from British National Bank. The customers in these two transactions have credit ratings that require them to borrow money at 11% interest.

Record the two journal entries that should be recorded by Grouper Inc. for the sales transactions above that took place on July 1, 2017.

Reference no: EM131728140

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