FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Q5.

 

On January 1, 2021, Norwood borrows $400,000 cash from a bank by signing a five-year installment note bearing 8% interest. The
note requires equal payments of $100,183 each year on December 31.
Required:
1. Complete an amortization table for this installment note.
2. Prepare the journal entries in which Norwood records the following:
(a) Norwood borrows $400,000 cash by signing a five-year, 8% installment note.
(b) Record the first installment payment on December 31, 2021.
(c) Record the second installment payment on December 31, 2022.
Complete this question by entering your answers in the tabs below.
Req 1
Complete an amortization table for this installment note. (Round your intermediate calculations to the nearest dollar amount.)
Period Ending Beginning
Debit Interest
Expense
Debit Notes
Payable
Ending Balance
Date
Balance
12/31/2021
12/31/2022
Req 2
12/31/2023
12/31/2024
12/31/2025
Total
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Transcribed Image Text:On January 1, 2021, Norwood borrows $400,000 cash from a bank by signing a five-year installment note bearing 8% interest. The note requires equal payments of $100,183 each year on December 31. Required: 1. Complete an amortization table for this installment note. 2. Prepare the journal entries in which Norwood records the following: (a) Norwood borrows $400,000 cash by signing a five-year, 8% installment note. (b) Record the first installment payment on December 31, 2021. (c) Record the second installment payment on December 31, 2022. Complete this question by entering your answers in the tabs below. Req 1 Complete an amortization table for this installment note. (Round your intermediate calculations to the nearest dollar amount.) Period Ending Beginning Debit Interest Expense Debit Notes Payable Ending Balance Date Balance 12/31/2021 12/31/2022 Req 2 12/31/2023 12/31/2024 12/31/2025 Total < Prev 18 of 18 Credit Cash Next >
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