On january 1, 2017, grouper company makes the two following acquisitions. 1. purchases land having a fair value of $310,000 by issuing a 4-year, zero-interest-bearing promissory note in the face amount of $470,602. 2. purchases equipment by issuing a 6%, 9-year promissory note having a maturity value of $460,000 (interest payable annually on january 1). the company has to pay 11% interest for funds from its bank. (a) record the two journal entries that should be recorded by grouper company for the two purchases on january 1, 2017. (b) record the interest at the end of the first year on both notes using the effective-interest method.

Exercise 7-7 martinez company reports the following financial information before adjustments. dr. cr. accounts receivable $168,900 allowance for doubtful accounts $3,200 sales revenue (all on credit) 849,300 sales returns and allowances 50,440 prepare the journal entry to record bad debt expense assuming martinez company estimates bad debts at (a) 4% of accounts receivable and (b) 4% of accounts receivable but allowance for doubtful accounts had a $1,550 debit balance. (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.)