9. On April 1, 2024, Millipede Machinery sold a tractor to Thomas Hartwood, accepting a...
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Accounting
9. On April 1, 2024, Millipede Machinery sold a tractor to Thomas Hartwood, accepting a note promising payment of $120,000 in five years. The applicable effective interest rate is 7%. (a) Prepare the journal entry to record the initial sale of the tractor (ignoring inventory and COGS). (b) Prepare the journal entry to record the interest accrual of $4,492 at December 31, 2024. (c) Prepare the journal entry on the date of receipt of payment on April 1, 2029. Assume that the interest earned during 2029 is $1,000.
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