On January 1, 2013, Billips Corporation purchased equipment having a fair value of $72,054.94 by issuing a

Question:

On January 1, 2013, Billips purchased equipment having a fair value of $72,054.94 by issuing a $90,000 note, payable in three $30,000 annual installments beginning December 31, 2013.
Required:
Prepare
(1) The journal entry to record the purchase of the equipment,
(2) A schedule to compute the annual interest expense, and
(3) The journal entries to record yearly interest expense and note repayments over the life of the note.
Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...