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Analyzing and Reporting Financial Statement Effects of Mortgages On January 1, Patterson Inc. borrowed $2,000,000 on a 10%, 15-year mortgage note payable. The note is to be repaid in equal semiannual installments of $130,102 (payable on June 30 and December 31). Each mortgage payment includes principal and interest. Interest is computed using the effective interest method. Indicate the financial statement effects using the template for (a) issuance of the mortgage note payable, (b) payment of the first installment on June 30, and (c) payment of the second installment on December 31. Note: For each account category, indicate the appropriate account name. Enter "N/A" for any account category that is not used for a given transaction. Note: Indicate a decrease in an account category by including a negative sign with the amount. Note: Round your answers to the nearest whole dollar. Transaction Check Cash Asset Noncash Assets Balance Sheet Liabilities Contrib. Capital Earned Capital Income St Revenues 2,000,000 2,000,000 Cash N/A ✰ Long term debt N/A N/A N/A N/A (130,102) (30,102) 10 (100,000)✓ Cash N/A Long term debt N/A Retained earnings N/A Interest (130,102)✓ 0~ (161,709.1) x く 0 x 0~ Cash N/A Long term debt N/A Retained earnings N/A = Interest

Analyzing and Reporting Financial Statement Effects of Mortgages On January 1, Patterson Inc. borrowed $2,000,000 on a 10%, 15-year mortgage note payable. The note is to be repaid in equal semiannual installments of $130,102 (payable on June 30 and December 31). Each mortgage payment includes principal and interest. Interest is computed using the effective interest method. Indicate the financial statement effects using the template for (a) issuance of the mortgage note payable, (b) payment of the first installment on June 30, and (c) payment of the second installment on December 31. Note: For each account category, indicate the appropriate account name. Enter "N/A" for any account category that is not used for a given transaction. Note: Indicate a decrease in an account category by including a negative sign with the amount. Note: Round your answers to the nearest whole dollar. Transaction Check Cash Asset Noncash Assets Balance Sheet Liabilities Contrib. Capital Earned Capital Income St Revenues 2,000,000 2,000,000 Cash N/A ✰ Long term debt N/A N/A N/A N/A (130,102) (30,102) 10 (100,000)✓ Cash N/A Long term debt N/A Retained earnings N/A Interest (130,102)✓ 0~ (161,709.1) x く 0 x 0~ Cash N/A Long term debt N/A Retained earnings N/A = Interest

Excel Applications for Accounting Principles
Excel Applications for Accounting Principles
4th Edition
ISBN:9781111581565
Author:Gaylord N. Smith
Publisher:Gaylord N. Smith
ChapterMB: Model-building Problems
Section: Chapter Questions
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Analyzing and Reporting Financial Statement Effects of Mortgages On January 1, Patterson Inc. borrowed $2,000,000 on a 10%, 15-year mortgage note payable. The note is to be repaid in equal semiannual installments of $130,102 (payable on June 30 and December 31). Each mortgage payment includes principal and interest. Interest is computed using the effective interest method. Indicate the financial statement effects using the template for (a) issuance of the mortgage note payable, (b) payment of the first installment on June 30, and (c) payment of the second installment on December 31. Note: For each account category, indicate the appropriate account name. Enter "N/A" for any account category that is not used for a given transaction. Note: Indicate a decrease in an account category by including a negative sign with the amount. Note: Round your answers to the nearest whole dollar. Transaction Cash Asset Noncash Assets Balance Sheet Liabilities Contrib. Capital Earned Capital a. 2,000,000 0 2,000,000 Cash N/A Long term debt N/A N/A N/A b. (130,102) 0 (30,102) 0✓ (100,000) Cashi N/A Long term debt N/A Retained earnings N/A C. (130,102) 0✓ (161,709.1) x 0✓ 0 x Cash N/A Long term debt N/A Retained earnings # N/A Check Income St Revenues N/A 0 Interest Interest Noncash Assets Balance Sheet Liabilities Contrib. Capital Earned Capital Income Statement Revenues Expenses Net Income 2,000,000 N/A Long term debt N/A N/A N/A N/A (30,102) 0✓ (100,000) ✓ 0✓ 100,000✓ (100,000) N/A Long term debt 0✓ ✰ N/A (161,709.1) x Retained earnings N/A Interest expense 0✓ 0 x 0 0 х 0 x N/A ÷ Long term debt ✓ N/A Retained earnings = N/A Interest expense ÷ Check
Transcribed Image Text:Analyzing and Reporting Financial Statement Effects of Mortgages On January 1, Patterson Inc. borrowed $2,000,000 on a 10%, 15-year mortgage note payable. The note is to be repaid in equal semiannual installments of $130,102 (payable on June 30 and December 31). Each mortgage payment includes principal and interest. Interest is computed using the effective interest method. Indicate the financial statement effects using the template for (a) issuance of the mortgage note payable, (b) payment of the first installment on June 30, and (c) payment of the second installment on December 31. Note: For each account category, indicate the appropriate account name. Enter "N/A" for any account category that is not used for a given transaction. Note: Indicate a decrease in an account category by including a negative sign with the amount. Note: Round your answers to the nearest whole dollar. Transaction Cash Asset Noncash Assets Balance Sheet Liabilities Contrib. Capital Earned Capital a. 2,000,000 0 2,000,000 Cash N/A Long term debt N/A N/A N/A b. (130,102) 0 (30,102) 0✓ (100,000) Cashi N/A Long term debt N/A Retained earnings N/A C. (130,102) 0✓ (161,709.1) x 0✓ 0 x Cash N/A Long term debt N/A Retained earnings # N/A Check Income St Revenues N/A 0 Interest Interest Noncash Assets Balance Sheet Liabilities Contrib. Capital Earned Capital Income Statement Revenues Expenses Net Income 2,000,000 N/A Long term debt N/A N/A N/A N/A (30,102) 0✓ (100,000) ✓ 0✓ 100,000✓ (100,000) N/A Long term debt 0✓ ✰ N/A (161,709.1) x Retained earnings N/A Interest expense 0✓ 0 x 0 0 х 0 x N/A ÷ Long term debt ✓ N/A Retained earnings = N/A Interest expense ÷ Check
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