Question

1.		It sold land having a fair value of $914,620 in exchange for a 4-year zero-interest-bearing promissory note in the face amount of $1,439,168. The land is carried on Cheyenne's books at a cost of $600,100.
2.		It rendered services in exchange for a 3%, 8-year promissory note having a face value of $405,130 (interest payable annually).

Cheyenne Inc. recently had to pay 8% interest for money that it borrowed from British National Bank. The customers in these two transactions have credit ratings that require them to borrow money at 12% interest.

Record the two journal entries that should be recorded by Cheyenne Inc. for the sales transactions above that took place on July 1, 2020. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and final answers to 0 decimal places, e.g. 5,275. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

No.	Date	Account Titles and Explanation	Debit	Credit
1.	July 1, 2020	enter an account title	enter a debit amount	enter a credit amount
		enter an account title	enter a debit amount	enter a credit amount
		enter an account title	enter a debit amount	enter a credit amount
		enter an account title	enter a debit amount	enter a credit amount
2.	July 1, 2020	enter an account title	enter a debit amount	enter a credit amount
		enter an account title	enter a debit amount	enter a credit amount
		enter an account title	enter a debit amount	enter a credit amount

Answer 1

	No	Date	Account titles and explanation					Debit	Credit
	1	July 1,2020	Note receivable					914620
			Land						600100
			Gain on sale of land		(914620-600100)				314520
			(Land sold in exchange of note)
	2	July 1,2020	Note receivable			(Note:1)		218880
			Sales revenue						218880
			(Sales revenue recorded)
	Note:1
	Face value of note=$ 405130
	It is received at the time of maturity
	Now,let's find the present value of face value of bonds
	Discount factor=Interest on money borrowed=8%
	Present value of face value of bonds=Face value of the bonds*Discount factor at 8% for the 8th year=405130*0.54027=$ 218880
	I appreciate your ratings