On July 1, 2013, Ketchikan Inc. borrowed $90,000 to finance the purchase of machinery. The terms of

Question:

On July 1, 2013, Ketchikan Inc. borrowed $90,000 to finance the purchase of machinery. The terms of the mortgage require payments to be made at the end of every month with the first payment of $1,589 being due on July 31, 2013. The length of the mortgage is seven years, and the mortgage carries an interest rate of 12% compounded monthly.
1. Prepare a mortgage amortization schedule for the last six months of 2013.
2. How much interest expense will be reported in 2013 in connection with this mortgage?
3. What amount will be reported in Ketchikan's as mortgage liability at the end of 2013?
Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...