Problem 2 Forensic Machinery issues an $1,200,000, 9%, 12 year mortgage note on December 31, 2022. The termo f the note provide for anual installment payments, exclusive of real estate taxes, of $135,000. Payments are due on December 31. Instructions: 1. Prepare an installment payment Schedule for the first 5 years. Annual Interest Period Issue Date 1 2 3 4 5 Cash Payment Interest Expense Reduction of Principal Principal Balance
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- Compound Interest Issues You are given the following situations: 1. Thomas Petty owes a debt of 7,000 from the purchase of a boat. The debt bears 12% interest payable annually. Thomas will pay the debt and interest in 5 annual installments beginning in 1 year. Calculate the equal annual installments that will pay off the debt and interest at 12% on the unpaid balance. 2. On January 1, 2019, John Cothran offers to buy Ruth Houses used tractor and equipment for 4,000 payable in 12 equal semiannual installments which are to include payment of 10% interest on the unpaid balance and payment of a portion of the principal with the first installment to be made on January 1, 2019. Calculate the amount of each of these installments. 3. Nadine Love invests in a 60,000 annuity at 12% compounded annually on March 1, 2019. The first of 15 receipts from the annuity is payable to Love on March 1, 2029, 10 years after the annuity is purchased and on the date Love expects to retire. Calculate the amount of each of the 15 equal annual receipts. Required: Using the appropriate tables, solve each of the preceding situations.Question Consider the first payment against a $200,000 mortgage that last for 25 years. Fixed repayments are made on a monthly basis. The first row of the amortization schedule is shown below. Payment # 1 2 Payment d Interest 716.67 ... Debt Payment P1 Calculate d, the fixed monthly payments that are made. Round your answer to the nearest cent. Balance b₁ IhLoan Receivable and Receivable Financing Activity 1: Problems Problem 1: PDR Bank granted a loan to a borrower on January1, 2020. The interest on the loan is 10% payable annually starting December 31, 2020. The loan matures in three years on December 31, 2022. Principal amount Origination fee charged againstthe borrower Direct origination cost incurred Indirect origination costs 2,000,000 171,050 75,000 15,000 After considering the origination fee charged againstthe borrower and the direct origination costincurred, the effective rate on theloan is 12.5%. Q1. The carrying amount oftheloan on January 1, 2020: is Q2: The journal entries on January 1,2020: Problem 2: LSB granted a loan to the borrower on January1, 2020. The interest on the loan is 8% payable annually starting December 31, 2020. Theloan matures in three years on December 31, 2022. Principal amount Origination fee charged against the borrower Direct origination cost incurred 1,500,000 50,000 130,150 After considering the…
- Hen it issues a $282,000, 10% mortgage note payable to finance the construction of a building at December 31, 2022. The terms provide for annual installment payments of $47,000 on December 31. Prepare the journal entries to record the mortgage loan and the first two payments. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Dec. 31, 2023 Dec. 31, 2024 Account Titles and Explanation Debit CreditPART 1 Cucina Corp. signed a new installment note on January 1, 2018, and deposited the proceeds of $70,000 in its bank account. The note has a 3-year term, compounds 5 percent interest annually, and requires an annual installment payment on December 31. Cucina Corp. has a December 31 year-end and adjusts its accounts only at year-end. Required: Use an online application, such as the loan calculator with annual payments at mycalculators.com, to generate an amortization schedule. Enter that information into an amortization schedule with the following headings: Year, Beginning Notes Payable, Interest Expense, Repaid Principal on Notes Payable, and Ending Notes Payable. Prepare the journal entries on (a) January 1, 2018, and December 31 of (b) 2018, (c) 2019, and (d) 2020. If Cucina Corp.'s year-end were March 31, rather than December 31, prepare the adjusting journal entry would it make for this note on March 31, 2018? PART 1 REQUIRED 1 IN ATTACHED IMAGE Required 2 Prepare…Part 1 Cucina Corp. signed a new installment note on January 1, 2018, and deposited the proceeds of $70,000 in its bank account. The note has a 3-year term, compounds 5 percent interest annually, and requires an annual installment payment on December 31. Cucina Corp. has a December 31 year-end and adjusts its accounts only at year-end. Required: Use an online application, such as the loan calculator with annual payments at mycalculators.com, to generate an amortization schedule. Enter that information into an amortization schedule with the following headings: Year, Beginning Notes Payable, Interest Expense, Repaid Principal on Notes Payable, and Ending Notes Payable. Prepare the journal entries on (a) January 1, 2018, and December 31 of (b) 2018, (c) 2019, and (d) 2020. If Cucina Corp.'s year-end were March 31, rather than December 31, prepare the adjusting journal entry would it make for this note on March 31, 2018? PART 1 REQUIRED 1 IS IN AN ATTACHED IMAGE Required 2…
- Brief Exercise 10-18 Tamarisk, Inc. issues a $580,000, 10%, 10-year mortgage note on December 31, 2022, to obtain financing for a new building. The terms provide for annual installment payments of $94,392. Prepare the entry to record the mortgage loan on December 31, 2022, and the first installment payment on December 31, 2023. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Dec. 31, 2022 Dec. 31, 2023QUESTION 1 A $30 000.00 mortgage is amortized by monthly payments over twenty years and is renewable after five years. a) If the interest rate is 8.5% compounded semi-annually, calculate the outstanding balance at the end of the second-year term. OA. $29188.08 B. $26378.01 OC. $28375.47 OD. $20138.92ONLINE 721757 K Complete the first month of the amortization schedule for a fixed-rate mortgage. Mortgage: $110,000 Interest rate: 6.5% Term of loan: 25 years Click the icon to view the Real Estate Amortization Table. Payment Number 1 Amortization Schedule Total Payment Interest Payment Principal Payment Balance of Principal (a) $ (b) $ (b) $ (d) $
- Problem 24Safari Bank granted a loan to a borrower on Jan. 1, 2020. The interest on the loan is 8% payable annually starting Dec. 31,2020. The loan matures in three years on Dec. 31,2022. Data related to the loan are:Principal amount 1,500,000Origination fees charged against the borrower 50,000Direct Origination cost incurred 130,150After consideration of the origination fees charged against the borrower and the direct origination cost incurred, the effective rate on the loan is 6%. Required:1. Prepare a table of amortization for the loan receivable.2. Prepare the journal entries for 2020, 2021 and 2022.Problem 24Safari Bank granted a loan to a borrower on Jan. 1, 2020. The interest on the loan is 8% payable annually starting Dec. 31,2020. The loan matures in three years on Dec. 31,2022. Data related to the loan are:Principal amount 1,500,000Origination fees charged against the borrower 50,000Direct Origination cost incurred 130,150After consideration of the origination fees charged against the borrower and the direct origination cost incurred, the effective rate on the loan is 6%. Required:1. Compute the carrying amount of the loan receivable on December 31,2020, December 31,2021, December 31,2022.2. Prepare a table of amortization for the loan receivable.Problem 24 Safari Bank granted a loan to a borrower on Jan. 1, 2020. The interest on the loan is 8% payable annually starting Dec. 31,2020. The loan matures in three years on Dec. 31,2022. Data related to the loan are: Principal amount Origination fees charged against the borrower Direct Origination cost incurred 1,500,000 50,000 130,150 After consideration of the origination fees charged against the borrower and the direct origination cost incurred, the effective rate on the loan is 6%. Required: 1. Compute the carrying amount of the loan receivable on December 31,2020, December 31,2021, December 31,2022. 2. Prepare a table of amortization for the loan receivable. 3. Prepare the journal entries for 2020, 2021 and 2022.