1. Downey Corporation issues a $350,000, 10%, 15-year mortgage note payable on December 31, 2017, 
2. to obtain financing for the construction of a building addition. The terms provide for annual installment 
3. payments of $44,540 on December 31 each year.

 (a)   Prepare a mortgage installment payment schedule for the first 3 annual payments

(round all dollar amounts to the nearest whole number; don't work with cents)

 

 PAYMENT

Interest Expense

Payment on Mortgage Note Payable

Carrying value of Mortgage Note Payable

12/31/2017

  XXX

XXX

XXX

 

1 12/31/18

 

 

 

 

2 12/31/19

 

 

 

 

3 12/31/20

 

 

 

 

 (b)  Prepare the journal entry for the issuance of the mortgage note payable.

 

 

(c)  Prepare the journal entries for the first mortgage payment made 12/31/2018.

 

 

 (c) How was this mortgage listed on the Dec. 31, 2019 balance sheet?

CURRENT ASSETS (part of mortgage to be paid in 2020)

 

 

LONG-TERM LIABILITIES (part of mortgage to pay after 2020)

  

PART B:

 Multiple Choice Question: Highlight the correct answer.

1. The entry to record the first $50,800 annual installment payment on an 8% long-term 
2. mortgage note payable of $600,000 would include a
3. debit to Interest Expense of $50,800
4. debit to Mortgage Note Payable of $2,800
5. debit to Mortgage Note Payable of $50,800
6. debit to cash of $48,000

 MAKE THE JOURNAL ENTRY BELOW:

 

 

 

 LEASE QUESTIONS: Highlight the correct answer.

T       F 1. With a capital lease, the present value of the lease payments should be recorded on the balance sheet as 

a long-term asset and a long-term liability, with any lease payments due in the following year to be shown as a current liability.

 

2. If a company leases a business vehicle for 5 years when the useful life of the asset is 10 years, and none of the

other 3 conditions that require a company to record an asset as a capital lease were met, the lease will qualify as a(n)

1. capital lease
2. operating lease

 

3. Make the journal entry for an operating lease with monthly lease payments of $4,000.

 

Please help me with above problems ASAP!

SuperTutor

(15)

Status NEW Posted 20 Jun 2017 02:06 AM My Price 15.00

-----------

Attachments

file 1497925712-Solutions file.docx preview (56 words )

S-----------olu-----------tio-----------ns -----------fil-----------e -----------Hel-----------lo -----------Sir-----------/Ma-----------dam----------- T-----------han-----------k y-----------ou -----------for----------- yo-----------ur -----------int-----------ere-----------st -----------and----------- bu-----------yin-----------g m-----------y p-----------ost-----------ed -----------sol-----------uti-----------on.----------- Pl-----------eas-----------e p-----------ing----------- me----------- on----------- ch-----------at -----------I a-----------m o-----------nli-----------ne -----------or -----------inb-----------ox -----------me -----------a m-----------ess-----------age----------- I -----------wil-----------l b-----------e q-----------uic-----------kly----------- on-----------lin-----------e a-----------nd -----------giv-----------e y-----------ou -----------exa-----------ct -----------fil-----------e a-----------nd -----------the----------- sa-----------me -----------fil-----------e i-----------s a-----------lso----------- se-----------nt -----------to -----------you-----------r e-----------mai-----------l t-----------hat----------- is----------- re-----------gis-----------ter-----------ed -----------onÂ----------- th-----------is -----------web-----------sit-----------e. ----------- H-----------YPE-----------RLI-----------NK -----------&qu-----------ot;-----------htt-----------p:/-----------/wo-----------rkb-----------ank-----------247-----------.co-----------m/&-----------quo-----------t; -----------\t -----------&qu-----------ot;-----------_bl-----------ank-----------&qu-----------ot;----------- -----------Tha-----------nk -----------you----------- -----------

Not Rated(0)

• Buy Answer