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Sawyer Technologies, Inc., provides specialized network solutions for companies in the financial services industry. During...

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Accounting

Sawyer Technologies, Inc., provides specialized network solutions for companies in the financial services industry. During the current year, Sawyer completed a network project for Williams Communications. The fair value of the project is not determinable. As part of the agreement, on February 1, Sawyer accepted a $5,005,000,6-month, zero-coupon note receivable at a time when the current market rate of interest was 6%. Sawyer prepares financial statements at its calendar year-end only.
Prepare the journal entry to record the transaction and the collection at maturity.
Prepare the journal entry to record the transaction. (Record debits first, then credits. Exclude explanations from any journal entries.)
On February 1, Sawyer accepted a $5,005,000,6-month, zero-coupon note receivable at a time when the current market rate of interest was 6%.
\table[[Account,February1,],[Notes Receivable,5,005,000,],[Service Revenue,,],[Discount on Notes Receivable,,],[,,]]
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