On 1/1/25, Thurber Medical Supply Company purchased a new computer system for its front office by signing a 4-year $75,000 zero-interest-bearing note. The cash price of this system is $47,664. The implicit interest rate on this note is 12%. REQUIRED:

a. Prepare the journal entry at the date of acquisition of the computer system.

b. Prepare the entry required at 12/31/25 and at 12/31/26

Instead of signing the zero-interest-bearing note, Thurber went to his bank and borrowed $47,664 by signing a 4-year 12% note with interest due semi-annually on 7/1 and 12/31. REQUIRED:

a. Prepare the journal entry at the date of acquisition of the computer system

b. Prepare the entry required at 7/1/25