Entries for Installment Note TransactionsOn the first day of the fiscal year, Shiller Company borrowed $22,000 by giving a five-year, 12% installment note to Soros Bank. The note requires annual payments of $6,207, with the first payment occurring on the last day of thefiscal year. The first payment consists of interest of $2,640 and principal repayment of $3,567.Journalize the entries to record the following:al. Issued the installment note for cash on the first day of the fiscal year.a2. Paid the first annual payment on the note. If an amount box does not require an entry, leave it blank.b. How would the notes payable be reported on the balance sheet at the end of the fiscal year?

A installment note is a liability which represents amount owed by a company to its lender like bank…

Answered: Entries for Installment Note…

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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Entries for Installment Note Transactions On January 1, 20Y2, Hebron Company issued a $33,000, 4-year, 8% installment note to Ventsam Bank. The note requires annual payments of $9,963, beginning on December 31, 20Y2. Journalize the entries to record the following: 20Y2 Jan. 1 Issued the note for cash at its face amount. Dec. 31 Paid the annual payment on the note, which consisted of interest of $2,640 and principal of $7,323. 20Y5 Dec. 31 Paid the annual payment on the note, included interest of $738. The remainder of the payment reduced the principal balance on the note. Issued the note for cash at its face amount. If an amount box does not require an entry, leave it blank. 20Y2 Jan. 1 fill in the blank b2a79dfd4f8ffc5_2 fill in the blank b2a79dfd4f8ffc5_3 fill in the blank b2a79dfd4f8ffc5_5 fill in the blank b2a79dfd4f8ffc5_6 Paid the annual payment on the note, which consisted of interest of $2,640 and principal of $7,323. If an…
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