Problem $14-13($Algo$)$ Note and installment note with unrealistic interest rate $[$LO$14-3]$

Braxton Technologies, Incorporated, constructed a conveyor for A&G Warehousers that was completed and ready for use on January $1,$

A&G paid for the conveyor by issuing a $$100,000,$ four$-$year note that specified $4\%$ interest to be paid on December $31$ of each

year, and the note is to be repaid at the end of four years.

The conveyor was custom$-$built for A&G$,$ so its cash price was unknown.

By comparison with similar transactions it was determined that a reasonable interest rate was $12\%.$

Required:

Prepare the journal entry for A&G$\text{'}$s purchase of the conveyor on January $1,2024.$

Prepare an amortization schedule for the four$-$year term of the note.

Prepare the journal entry for A&G$\text{'}$s third interest payment on December $31,2026.$

If A&G$\text{'}$s note had been an installment note to be paid in four equal payments at the end of each year beginning December $31,$

$2024,$ what would be the amount of each installment?

By considering the installment payment of requirement $4,$ prepare an amortization schedule for the four$-$year term of the

installment note.

Prepare the journal entry for A&G$\text{'}$s third installment payment on December $31,2026.$

Note: Use tables, Excel, or a financial calculator. $($FV of $$1,$ PV of $$1.$ FVA of $$1.$ PVA of $$1.$ FVAD of $$1$ and PVAD of $$1)$

Complete this question by entering your answers in the tabs below.

Prepare the journal entry for A&G$\text{'}$s purchase of the conveyor on January $1,2024.$

Note: If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field. Round intermediate

calculations and final answers to the nearest whole dollar.

Journal entry worksheet

$1$

Record A&G$\text{'}$s purchase of the conveyor.

Note: Enter debits before credits.