Check my work Exercise 14-19 Installment note; lender; amortization schedule LO1
ID: 2403958 • Letter: C
Question
Check my work Exercise 14-19 Installment note; lender; amortization schedule LO14-3] FinanceCo lent $87 million to Corbin Construction on January 1, 2018, to construct a playground. Corbin signed a three-year, 8% installment note to be paid in three equal payments at the end of each year. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) ed Required: 1. Prepare the journal entry for FinanceCo's lending the funds on January 1, 2018 2. Prepare an amortization schedule for the three-year term of the installment note. 3. Prepare the journal entry for the first installment payment on December 31. 2018. 4. Prepare the journal entry for the third installment payment on December 31, 2020. Complete this question by entering your answers in the tabs below Req 2Req 1 3 and 4 Prepare an amortization schedule for the three-year term of the installment note. (Enter your answers in whole dollars.) Dec. 31Cash Payment Effective Interest 2018 2019 2020 Req 1 3 and 4 >Explanation / Answer
Amortization schedule
Journal Entries
01/01/2018 Corbin Construction comapny's loan A/C Dr. 8.7 Million Dollars
To Bank A/c 8.7 Million Dollars
(Being entry for Loan amount given being passed in the books of Finance Co.)
31/12/2018 Bank account Dr. 3375892
to Interest recievable on loan 696000
to Corbin Construction comapny's loan A/C 2679892
(Being First installment recieved)
31/12/2020
Bank account Dr. 3375892
to Interest recievable on loan 250066
to Corbin Construction comapny's loan A/C 3125825
(Being Thrid installment recieved)
Dec 31 Cash Payment Effective interest Decrease in balance Outstanding Balance 2018 3375892 696000 2679892 6020108 2019 3375892 481608 2894283 3125825 2020 3375892 250066 3125825 0