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
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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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