Stuckey Company borrowed $800,000 on December 31, 2016, by issuing an $300,000,
ID: 2405360 • Letter: S
Question
Stuckey Company borrowed $800,000 on December 31, 2016, by issuing an $300,000, 3% mortgage note payable. The terms call for annual installment payments of $119,224 on December 31. Prepare the journal entries to record the mortgage loan and the first two installment payments. (Round answers to O decimal places, e.g. 15,250. Credit account tities are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation DebitCredit Dec. 31, 2016 Dec. 31, 2017 Dec. 31, 2018
Explanation / Answer
Q1. Amort Chart Year Payment Interest Principle Balance at the end 31.12.16 800000 31.12.17 119224 64000 55224 744776 31.12.18 119224 59582 59642 685134 Journal entries: Date Accounts title and explanations Debit $ Credit $ 31.12.16 Cash account Dr. 800000 Mortgage loan payable Account 800000 31.12.17 Interest expense Account Dr. 64000 Mortgage loan payable account Dr. 55224 Cash account 119224 31.12.18 Interest expense Account Dr. 59582 Mortgage loan payable account Dr. 59642 Cash account 119224