Talkington Electronics issues a $400,000, 8%, 15-year mortgage note on December 31, 2019. The proceeds from the

Question:

Talkington Electronics issues a $400,000, 8%, 15-year mortgage note on December 31, 2019. The proceeds from the note are to be used in financing a new research laboratory. The terms of the note provide for annual installment payments, exclusive of real estate taxes and insurance, of $59,612. Payments are due on December 31.

Instructions
a. Prepare an installment payments schedule for the first 4 years.
b. Prepare the entries for (1) the loan and (2) the first installment payment.
c. Show how the total mortgage liability should be reported on the balance sheet at December 31, 2020.

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...

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