Many businesses borrow money during periods of increased business activity to finance inventory and trade receivables. Sears Canada Inc. is one of Canada's largest general merchandise retailers. Each year, Sears Canada builds up its inventory to meet the needs of December holiday shoppers. A large portion of these holiday sales are on credit. As a result, Sears Canada often collects cash from the sales several months after the December holidays. Assume that on November 1, 2017, Sears Canada borrowed $4.5 million cash from the bank for working capital purposes and signed an interest-bearing note due in six months. The interest rate was 5 percent per annum, payable at maturity. Assume that the fiscal year of Sears Canada ends on December 31.

Required:
1. Prepare the journal entry to record the note on November 1, 2017.
2. Prepare any adjusting entry required at December 31, 2017.
3. Prepare the journal entry to record payment of the note and interest on the maturity date, April 30, 2018.
4. If Sears Canada needs extra cash for every December holiday season, should management borrow money on a long-term basis to avoid the necessity of negotiating a new short-term loan each year?