On January 1, a company borrowed cash by issuing a $390,000, 4%, installment note to be paid in three equal payments at the end of each year beginning December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) What would be the amount of each installment?Prepare an amortization table for the installment note.Prepare the journal entry for the second installment payment.

On January 1, a company borrowed cash by issuing a $390,000, 4%, installment note to be paid in three equal payments at the end of each year beginning December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) What would be the amount of each installment?Prepare an amortization table for the installment note.Prepare the journal entry for the second installment payment.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 1PA: On January 1, 2018, King Inc. borrowed $150,000 and signed a 5-year, note payable with a 10%...

See similar textbooks

Similar questions

On January 1, 2018, King Inc. borrowed $150,000 and signed a 5-year, note payable with a 10% interest rate. Each annual payment is in the amount of $39,569 and payment is due each Dec. 31. What is the journal entry on Jan. 1 to record the cash received and on Dec. 31 to record the annual payment? (You will need to prepare the first row in the amortization table to determine the amounts.)
Chemical Enterprises issues a note in the amount of $156,000 to a customer on January 1, 2018. Terms of the note show a maturity date of 36 months, and an annual interest rate of 8%. What is the accumulated interest entry if 9 months have passed since note establishment?
A company collects an honored note with a maturity date of 24 months from establishment, a 10% interest rate, and an initial loan amount of $30,000. Which accounts are used to record collection of the honored note at maturity date? A. Interest Revenue, Interest Expense, Cash B. Interest Receivable, Cash, Notes Receivable C. Interest Revenue, Interest Receivable, Cash, Notes Receivable D. Notes Receivable, Interest Revenue, Cash, Interest Expense
Jain Enterprises honors a short-term note payable. Principal on the note is $425,000, with an annual interest rate of 3.5%, due in 6 months. What journal entry is created when Jain honors the note?
A customer takes out a loan of $130,000 on January 1, with a maturity date of 36 months, and an annual interest rate of 11%. If 6 months have passed since note establishment, what would be the recorded interest figure at that time? A. $7,150 B. $65,000 C. $14,300 D. $2,383
On January 1, a company borrowed cash by issuing a $430,000, 4%, installment note to be paid in three equal payments at the end of each year beginning December 31. Note: Use tables, Excel, or a financial calculator. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) What would be the amount of each installment? Prepare an amortization table for the installment note. Prepare the journal entry for the second installment payment.
On January 1, Year 1, Bryson Company obtained a $147,750, four-year, 7% installment note from Campbell Bank. The note requires annual payments of $43,620, beginning on December 31, Year 1.a. Prepare an amortization table for this installment note, similar to the one presented in Exhibit 4.b. Journalize the entries for the issuance of the note and the four annual note payments.c. Describe how the annual note payment would be reported in the Year 1 income statement. Exhibit 4 Attached
On January 1, 20X1, Bouncy House, Inc. obtains a $50,000, 6 year, 8% installment note for the latest and greatest bouncy house. Bouncy House is required to make annual payments. The first payment occurs on December 31, 20X1. а. Calculate your annual payment amount. b. Create the loan amortization schedule (table). Record the first three journal entries. d. How much total interest does Bouncy House pay on this installment note? С.
prepare a three-year (monthly) amortization schedule to classify the notes payable into its current and long-term amounts. See October 1, 2020 transaction for details of loan. October 1 - Bought office equipment for $15,000 and signed a three-year promissory note with a local bank. The annual interest rate is 5%, with monthly payments of $449.56 beginning on November 1.
On January 1, Year 1, Bryson Company obtained a $36,000, four-year, 8% installment note from Campbell Bank. The note requires annual payments of $10,869, beginning on December 31, Year 1. Question Content Area a. Prepare an amortization table for this installment note, similar to the one presented in Exhibit 4. Note: Enter all amounts to the nearest whole dollar. Round Year 4 Interest Expense (up or down) to ensure the carrying amount is zero at the end of the note term. Amortization of Installment Notes Year EndingDecember 31 January 1Carrying Amount Note Payment(Cash Paid) Interest Expense(7% of January 1Note CarryingAmount) Decrease inNotes Payable December 31Carrying Amount Year 1 $fill in the blank b118f2fd6fc7fe2_3 $fill in the blank b118f2fd6fc7fe2_4 $fill in the blank b118f2fd6fc7fe2_5 Year 2 fill in the blank b118f2fd6fc7fe2_8 fill in the blank b118f2fd6fc7fe2_9 fill in the blank b118f2fd6fc7fe2_10 Year 3 fill in the…
Recording Entries for an Installment Note Payable On January 1 of Year 1, a borrower signed a long-term note, face amount of $160,000; time to maturity is three years; stated rate of 8%. The market rate is 10%. The note will be paid in three equal annual installments of $62,085 on each December 31 (which is the accounting year-end for the borrower). Required Note: Round your answer to the nearest whole dollar. Please avoid answers in image thank you
Recording Entries for an Installment Note Payable On January 1 of Year 1, a borrower signed a long-term note, face amount of $240,000; time to maturity is three years; stated rate of 8%. The market rate is 10%. The note will be paid in three equal annual installments of $93,127 on each December 31 (which is the accounting year-end for the borrower). Required Note: Round your answer to the nearest whole dollar. a. Compute the cash received by the borrower. 0 b. Prepare a debt amortization schedule. Note: Round each amount in the table to the nearest whole dollar. Note: Use a negative sign for the "Reduction in N.P." amounts. Date Jan. 1, Year 1 Dec. 31, Year 1 $ Dec. 31, Year 2 $ Dec. 31, Year 3 $ Total $ Cash 0 $ 0 $ 0 $ 0 $ Interest Expense Reduction Carrying in N.P. Value 0 $ 0 $ 0 $ 0 $ $ 0 $ 0 $ 0 $ 0 0 0 0 O