Purchasing with a Non-Interest Bearing Note Topic 10

On January 1, Year 1, Mission Company agreed to buy some equipment from Anna Company. Mission signed a non-interest-bearing note, agreeing to pay Anna $500,000 for the equipment on December 31, Year 3. The implied rate of interest for this note was 10%.

Record the journal entry for the purchase of this equipment for Mission Company on January 1, Year 1.