4. Wigan Cars issues an $17,00,000, 9%, 15-year mortgage note on December 31, 2010, to help finance a plant expansion program. The terms provide for 3-annual installment payments, not including real estate taxes and insurance of $65,000. Payments are due April 30, August 31 and December 31. Instructions (a) Prepare an installment payments schedule for the first 3 years. (b) Prepare the entries for (1) the mortgage loan and (2) the first two installment payments. (c) Show how the total mortgage liability should be reported on the balance sheet at December 31, 2011.

4. Wigan Cars issues an $17,00,000, 9%, 15-year mortgage note on December 31, 2010, to help finance a plant expansion program. The terms provide for 3-annual installment payments, not including real estate taxes and insurance of $65,000. Payments are due April 30, August 31 and December 31. Instructions (a) Prepare an installment payments schedule for the first 3 years. (b) Prepare the entries for (1) the mortgage loan and (2) the first two installment payments. (c) Show how the total mortgage liability should be reported on the balance sheet at December 31, 2011.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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