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Accounting Help - Accounting Question?

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Accounting Help - Accounting Question?

Postby amd » Tue Jun 12, 2012 5:42 pm

P10-5A
Fordyce Electronics issues a $400,000, 8%, 10-year mortgage note on December 31, 2010. The proceeds from the note are to be used in financing a new research laboratory. The terms of the note provide for semiannual installment payments, exclusive of real estate taxes and insurance, of $29,433. Payments are due June 30 and December 31.




Complete the installment payments schedule for the first 2 years. (Round answers to 0 decimal places, e.g. 125. Use rounded amounts for future calculations.)
Semiannual
Interest Period
Cash Payment
Interest Expense
Reduction
of Principal
Principal Balance

Issue Date $
1 $
2
3
4







Prepare the entries for (1) the loan and (2) the first two installment payments. (For multiple debit/credit entries, list amounts from largest to smallest e.g. 10, 5, 3, 2. Round answer to 0 decimal places, e.g. 125.)
Date Account/Description Debit Credit
2010
Dec. 31
2011

June 30


Dec. 31








Show how the total mortgage liability should be reported on the balance sheet at December 31, 2011. (Round answer to 0 decimal places, e.g. 125.)
Current liabilities 12/31/11

Long-term liabilities
amd
 
Posts: 851
Joined: Wed Mar 23, 2011 1:21 am

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