Solution-Record the two journal entries that should be

Record the two journal entries that should be recorded

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Reference no: EM133182334

Question - On July 1, 2020, Pronghorn Inc. made two sales.

1. It sold land having a fair value of $905,820 in exchange for a 4-year zero-interest-bearing promissory note in the face amount of $1,425,321. The land is carried on Pronghorn's books at a cost of $599,100.

2. It rendered services in exchange for a 3%, 8-year promissory note having a face value of $409,970 (interest payable annually).

Pronghorn 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 12% interest.

Required - Record the two journal entries that should be recorded by Pronghorn Inc. for the sales transactions above that took place on July 1, 2020.

Reference no: EM133182334

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Record the two journal entries that should be recorded

Reference no: EM133182334

Reference no: EM133182334

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