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