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On December $31,2025,$ Windsor Co$.$ performed environmental consulting services for Hayduke Co$.$ Hayduke was short of cash, and

Windsor Co$.$ agreed to accept a $$262,700$ zero$-$interest$-$bearing note due December $31,2027,$ as payment in full. Hayduke is

somewhat of a credit risk and typically borrows funds at a rate of $11\%.$ Windsor is much more creditworthy and has various lines of

credit at $6\%.$

$($a$)$

Your answer is correct.

Prepare the journal entry to record the transaction of December $31,2025,$ for the Windsor Co$.($Round present value factor

calculations to $5$ decimal places, e$.$g$.1\mathrm{.}25124$ 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. List all debit entries before credit entries.$)$

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$($b$)$

Your answer is partially correct.

Assuming Windsor Co$.\text{'}$s fiscal year$-$end is December $31,$ prepare the journal entry for December $31,2026.($Round 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. List debit entry before credit entry.$)$

Date

Account Titles and Explanation

Discount on Notes Receivable

Interest Revenue

Debit

Credit

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