Long-term notes payable: Long-term notes payable represent a legal and written promise made by the business to pay a debt with interest over a period of more than a year. It is reported under the long-term liability section of the balance sheet . Installment note: It is a debt in which the borrower is required to pay equal periodic payments to the lender based on the term of the note. Amortization Schedule: An amortization schedule is a table that shows the details of each loan payment allocated between the principal amount and the overdue interest along with the beginning and ending balance of the loan. From the amortization schedule of the loan, the periodical interest expense, total interest expense and total payment made are known. To prepare: An amortization table for the installment note.

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Answer 1

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Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 14, Problem 14.12EX

a)

To determine

Long-term notes payable: Long-term notes payable represent a legal and written promise made by the business to pay a debt with interest over a period of more than a year. It is reported under the long-term liability section of the balance sheet.

Installment note: It is a debt in which the borrower is required to pay equal periodic payments to the lender based on the term of the note.

Amortization Schedule: An amortization schedule is a table that shows the details of each loan payment allocated between the principal amount and the overdue interest along with the beginning and ending balance of the loan. From the amortization schedule of the loan, the periodical interest expense, total interest expense and total payment made are known.

To prepare: An amortization table for the installment note.

b)

To determine

To Journalize: The issuance of the installment note for cash.

To determine

To Journalize: The first annual payment on the note.

To determine

To Journalize: The second annual payment on the note.

To determine

To Journalize: The third annual payment on the note.

To determine

To Journalize: The fourth annual payment on the note.

c)

To determine

To describe: How the annual note payment would be reported in the 2016 income statement.

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Silver Enterprises started the year with the following: Assets $70,000; Common Stock $20,000; Retained Earnings $10,000. During the year, the company earned revenue of $25,000, all of which was received in cash, and incurred expenses of $20,000, half of which were unpaid as of the end of the year. In addition, the company paid dividends of $5,000 to owners. Assume no other activities occurred during the year. Determine the amount of Silver's liabilities at the end of the year.

Answer 2

Question

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 14, Problem 14.12EX

a)

To determine

Long-term notes payable: Long-term notes payable represent a legal and written promise made by the business to pay a debt with interest over a period of more than a year. It is reported under the long-term liability section of the balance sheet.

Installment note: It is a debt in which the borrower is required to pay equal periodic payments to the lender based on the term of the note.

Amortization Schedule: An amortization schedule is a table that shows the details of each loan payment allocated between the principal amount and the overdue interest along with the beginning and ending balance of the loan. From the amortization schedule of the loan, the periodical interest expense, total interest expense and total payment made are known.

To prepare: An amortization table for the installment note.

b)

To determine

To Journalize: The issuance of the installment note for cash.

To determine

To Journalize: The first annual payment on the note.

To determine

To Journalize: The second annual payment on the note.

To determine

To Journalize: The third annual payment on the note.

To determine

To Journalize: The fourth annual payment on the note.

c)

To determine

To describe: How the annual note payment would be reported in the 2016 income statement.

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Answer 3

Question

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 14, Problem 14.12EX

a)

To determine

Long-term notes payable: Long-term notes payable represent a legal and written promise made by the business to pay a debt with interest over a period of more than a year. It is reported under the long-term liability section of the balance sheet.

Installment note: It is a debt in which the borrower is required to pay equal periodic payments to the lender based on the term of the note.

Amortization Schedule: An amortization schedule is a table that shows the details of each loan payment allocated between the principal amount and the overdue interest along with the beginning and ending balance of the loan. From the amortization schedule of the loan, the periodical interest expense, total interest expense and total payment made are known.

To prepare: An amortization table for the installment note.

b)

To determine

To Journalize: The issuance of the installment note for cash.

To determine

To Journalize: The first annual payment on the note.

To determine

To Journalize: The second annual payment on the note.

To determine

To Journalize: The third annual payment on the note.

To determine

To Journalize: The fourth annual payment on the note.

c)

To determine

To describe: How the annual note payment would be reported in the 2016 income statement.

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Answer 4

Question

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 14, Problem 14.12EX

a)

To determine

Long-term notes payable: Long-term notes payable represent a legal and written promise made by the business to pay a debt with interest over a period of more than a year. It is reported under the long-term liability section of the balance sheet.

Installment note: It is a debt in which the borrower is required to pay equal periodic payments to the lender based on the term of the note.

Amortization Schedule: An amortization schedule is a table that shows the details of each loan payment allocated between the principal amount and the overdue interest along with the beginning and ending balance of the loan. From the amortization schedule of the loan, the periodical interest expense, total interest expense and total payment made are known.

To prepare: An amortization table for the installment note.

b)

To determine

To Journalize: The issuance of the installment note for cash.

To determine

To Journalize: The first annual payment on the note.

To determine

To Journalize: The second annual payment on the note.

To determine

To Journalize: The third annual payment on the note.

To determine

To Journalize: The fourth annual payment on the note.

c)

To determine

To describe: How the annual note payment would be reported in the 2016 income statement.

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Answer 5

Chapter 14, Problem 14.12EX

a)

To determine

Long-term notes payable: Long-term notes payable represent a legal and written promise made by the business to pay a debt with interest over a period of more than a year. It is reported under the long-term liability section of the balance sheet.

Installment note: It is a debt in which the borrower is required to pay equal periodic payments to the lender based on the term of the note.

Amortization Schedule: An amortization schedule is a table that shows the details of each loan payment allocated between the principal amount and the overdue interest along with the beginning and ending balance of the loan. From the amortization schedule of the loan, the periodical interest expense, total interest expense and total payment made are known.

To prepare: An amortization table for the installment note.

b)

To determine

To Journalize: The issuance of the installment note for cash.

To determine

To Journalize: The first annual payment on the note.

To determine

To Journalize: The second annual payment on the note.

To determine

To Journalize: The third annual payment on the note.

To determine

To Journalize: The fourth annual payment on the note.

c)

To determine

To describe: How the annual note payment would be reported in the 2016 income statement.

Answer 6

Chapter 14, Problem 14.12EX

a)

To determine

Long-term notes payable: Long-term notes payable represent a legal and written promise made by the business to pay a debt with interest over a period of more than a year. It is reported under the long-term liability section of the balance sheet.

Installment note: It is a debt in which the borrower is required to pay equal periodic payments to the lender based on the term of the note.

Amortization Schedule: An amortization schedule is a table that shows the details of each loan payment allocated between the principal amount and the overdue interest along with the beginning and ending balance of the loan. From the amortization schedule of the loan, the periodical interest expense, total interest expense and total payment made are known.

To prepare: An amortization table for the installment note.

Answer 7

Chapter 14, Problem 14.12EX

a)

To determine

Long-term notes payable: Long-term notes payable represent a legal and written promise made by the business to pay a debt with interest over a period of more than a year. It is reported under the long-term liability section of the balance sheet.

Installment note: It is a debt in which the borrower is required to pay equal periodic payments to the lender based on the term of the note.

Amortization Schedule: An amortization schedule is a table that shows the details of each loan payment allocated between the principal amount and the overdue interest along with the beginning and ending balance of the loan. From the amortization schedule of the loan, the periodical interest expense, total interest expense and total payment made are known.

To prepare: An amortization table for the installment note.

Answer 8

b)

To determine

To Journalize: The issuance of the installment note for cash.

Answer 9

b)

To determine

To Journalize: The issuance of the installment note for cash.

Answer 10

To determine

To Journalize: The first annual payment on the note.

Answer 11

To determine

To Journalize: The first annual payment on the note.

Answer 12

To determine

To Journalize: The second annual payment on the note.

Answer 13

To determine

To Journalize: The second annual payment on the note.

Answer 14

To determine

To Journalize: The third annual payment on the note.

Answer 15

To determine

To Journalize: The third annual payment on the note.

Answer 16

To determine

To Journalize: The fourth annual payment on the note.

Answer 17

To determine

To Journalize: The fourth annual payment on the note.

Answer 18

c)

To determine

To describe: How the annual note payment would be reported in the 2016 income statement.

Answer 19

c)

To determine

To describe: How the annual note payment would be reported in the 2016 income statement.

Answer 20

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Answer 21

Expert Solution & Answer

Answer 22

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Answer 23

Ch. 14 - Describe the two distinct obligations incurred by...Ch. 14 - Explain the meaning of each of the following terms...Ch. 14 - If you asked your broker to buy you a 12% bond...Ch. 14 - Prob. 4DQ Ch. 14 - If bonds issued by a corporation are sold at...Ch. 14 - The following data relate to a 2,000,000, 8% bond...Ch. 14 - Bonds Payable has a balance of 5,000,000, and...Ch. 14 - What is a mortgage note?Ch. 14 - Fleeson Company needs additional funds to purchase...Ch. 14 - In what section of the balance sheet would a bond...

Solution Summary: The author explains how to prepare an amortization schedule for an installment note.

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To Journalize: The issuance of the installment note for cash.

To Journalize: The first annual payment on the note.

To Journalize: The second annual payment on the note.

To Journalize: The third annual payment on the note.

To Journalize: The fourth annual payment on the note.

To describe: How the annual note payment would be reported in the 2016 income statement.

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Chapter 14 Solutions