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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

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

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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**Problem 2** Forensic Machinery issues a $1,200,000, 9%, 12-year mortgage note on December 31, 2022. The terms of the note provide for annual 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 | Cash Payment | Interest Expense | Reduction of Principal | Principal Balance | |------------------------|--------------|------------------|-------------------------|-------------------| | Issue Date | | | | | | 1 | | | | | | 2 | | | | | | 3 | | | | | | 4 | | | | | | 5 | | | | | 2. Prepare the entries for (a) the loan and (b) the first installment payment.
Transcribed Image Text:**Problem 2** Forensic Machinery issues a $1,200,000, 9%, 12-year mortgage note on December 31, 2022. The terms of the note provide for annual 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 | Cash Payment | Interest Expense | Reduction of Principal | Principal Balance | |------------------------|--------------|------------------|-------------------------|-------------------| | Issue Date | | | | | | 1 | | | | | | 2 | | | | | | 3 | | | | | | 4 | | | | | | 5 | | | | | 2. Prepare the entries for (a) the loan and (b) the first installment payment.
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