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Lily Company purchased a building on January 2 by signing a long-term $570000 mortgage with monthly payments of $4800. The mortgage carries an interest rate of 10 percent. The entry to record the first monthly payment will include a O credit to the Mortgage Payable account for $4800. O debit to the Interest Expense account for $4750. O debit to the Cash account for $4800. O credit to the Cash account for $4750.

Lily Company purchased a building on January 2 by signing a long-term $570000 mortgage with monthly payments of $4800. The mortgage carries an interest rate of 10 percent. The entry to record the first monthly payment will include a O credit to the Mortgage Payable account for $4800. O debit to the Interest Expense account for $4750. O debit to the Cash account for $4800. O credit to the Cash account for $4750.

FINANCIAL ACCOUNTING
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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Lily Company purchased a building on January 2 by signing a long-term $570000 mortgage with monthly payments of $4800. The mortgage carries an interest rate of 10 percent. The entry to record the first monthly payment will include a O credit to the Mortgage Payable account for $4800. O debit to the Interest Expense account for $4750. Odebit to the Cash account for $4800. O credit to the Cash account for $4750.
Transcribed Image Text:Lily Company purchased a building on January 2 by signing a long-term $570000 mortgage with monthly payments of $4800. The mortgage carries an interest rate of 10 percent. The entry to record the first monthly payment will include a O credit to the Mortgage Payable account for $4800. O debit to the Interest Expense account for $4750. Odebit to the Cash account for $4800. O credit to the Cash account for $4750.
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