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xyz company has an accounts payable of $120,000 from inventory purchased in the previous month...

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Accounting

xyz company has an accounts payable of $120,000 from inventory purchased in the previous month on account. instead of payig off it's 120,000 liability when due this month, XYZ Company has worked out a deal with their venodr to convert their current liability into a long lertn note payable in which the vendor will earn 2% interest. What journal entry is required to convert the liabliities within XYZ Company's records on the daye of the deal?

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