Date 11/1/22 11/1/23 11/1/24 11/1/25 Total Cash Paid 500,000 500,000 500,000 500,000 1,500,000 Date 12/31/2022 11/1/23 Interest Expense 113908 Amount Interest Expense Cash Building 79160 41284 (Continued on the next page) Problem III (continued): Part C: In the general journal below, prepare the 12/31/22 adjusting entry for accrued interest and the entry to record the first installment payment on 11/1/23. Round interest calculations to the nearest whole month and dollar. Interest Expense 234353 Reduction in CV 386092 420840 458716 1265647 Carrying Value (CV) 1265647 879556 458716 Debit Credit
Date 11/1/22 11/1/23 11/1/24 11/1/25 Total Cash Paid 500,000 500,000 500,000 500,000 1,500,000 Date 12/31/2022 11/1/23 Interest Expense 113908 Amount Interest Expense Cash Building 79160 41284 (Continued on the next page) Problem III (continued): Part C: In the general journal below, prepare the 12/31/22 adjusting entry for accrued interest and the entry to record the first installment payment on 11/1/23. Round interest calculations to the nearest whole month and dollar. Interest Expense 234353 Reduction in CV 386092 420840 458716 1265647 Carrying Value (CV) 1265647 879556 458716 Debit Credit
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:### Section Title: Loan Amortization and Journal Entries
#### Loan Amortization Table:
**Date | Cash Paid | Interest Expense | Reduction in CV | Carrying Value (CV)**
---
- **11/1/22:** 500,000 | 113,908 | 386,092 | 1,265,647
- **11/1/23:** 500,000 | 79,160 | 420,840 | 879,556
- **11/1/24:** 500,000 | 41,284 | 458,716 | 458,716
- **11/1/25:** 500,000 | - | - | -
- **Total:** 1,500,000 | 234,353 | 1,265,647
#### Instructions:
**Problem III (continued):**
**Part C:** In the general journal below, prepare the 12/31/22 adjusting entry for accrued interest and the entry to record the first installment payment on 11/1/23. Round interest calculations to the nearest whole month and dollar.
#### Journal Entries:
| Date | Amount | Debit | Credit |
|------------|--------------------|---------------|---------------|
| 12/31/2022 | Interest Expense | | |
| | Cash | | |
| 11/1/23 | Building | | |
| | Interest Expense | | |
*Note: Carrying Value (CV) refers to the value of the loan that remains after payments are made.*
This exercise helps students understand the process of loan amortization, calculating interest, and preparing journal entries in accounting.
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