On October 1, 2025, Blossom Equipment Company made a sale by selling a pecan-harvesting machine to Valco Brothers Farm, Inc. Instead of a cash payment, Valco Brothers Farm issued a 2-year, $128,000, 8% note to Blossom Equipment Company. The terms of the note required annual interest payments on October 1. Since Swifty Equipment Company’s financial statements are prepared on a calendar-year basis, let’s break down the relevant journal entries: