On January 1, 2015, Peg, Inc

Essay

On January 1, 2015, Peg, Inc. bought some equipment by signing a non-interest-bearing note for $160,000. The note is to be paid in four equal annual $40,000 payments, beginning on December 31, 2015. Current interest rates were 8%. The present value and future value information for 8%, 4 periods follows: Required:
Prepare the journal entries necessary on January 1, 2015, and December 31, 2015.