On April 1, 2014, Corron sold a patent to Tilton Company in exchange for a $200,000 zero interest bearing note due on April 1, 2016. There was no established exchange price for the patent and the note had no ready market value. The prevailing interest rate for a note of this type on April 1, 2014 was 10%. The patent had a carrying value of $50,000 on January 1, 2014 and the amortization for the year ended December 31, 2014 would have been $6000. The collection of the note receivable from Tilton Company was reasonably assured.
Required: Prepare all journal entries and adjusting entries that Corron company would make for 2014, 2015 and 2016 related to the sale of the patent. Corron’s fiscal year ends on December 31st.