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1.The promissory note will be a asset and the name of the account is the notes receivable, notes receive will go up farm equipment receivable is going to decrease. It should be listed Cash then promissory note which will be note receivable on balance sheet. The increase for the asset will cause the amount on the balance sheet to increase which could cause the increase in equity. 2. One of the accounts is going to be cash when john deere makes a loan to the farm account the cash account will decrease. This should be recorded as an increase in assets, Accounts Receivable with a debit entry, and an increase in Revenue, with a credit entry. 3. When a farmer makes a loan payment to Deere the cash account is debited (increased) and the Accounts Receivable account is now decreased (credited). The credits and debits has to be equal, the only reason is because the tuition payment is prepaid. The journal entry that should be recorded for the tuition payment is unearned revenue.
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