1.The storage building was self-constructed this year by DeeDee. The Company had their initial expenditure of $700,000 on January 1. They paid an additional $500,000 on March 1^st , $300,000 on June 1^st, and then the final payment of $150,000 on August 1^st. when the building was completed and occupancy occurred. Payments to contractor were properly capitalized. The company has decided to use S/L method for depreciation. The storage building is estimated to have a life of 30 years and a savage value of $250,000. The company will take a full year of depreciation in year of acquisition.

2.DeeDee Double Entry has two loans outstanding as of 12/31/2017. Interest is paid annually on January 1st. The facts on each loan are as follows: Onstar Bank Loan outstanding since January 1, 2017 with a 3.5% interest rate. This loan was taken out to finance the construction of the Storage Building. Interest for the year and 15% of the principle will be paid to the bank on January 1, 2018. Except for recording the initial cash received and loan, no additional entries have been made. Coldstar Bank Loan also outstanding all of 2017 with a 4.1 % interest rate . Interest is due on January 1, 2018. Principle is due on January 1, 2023. Since interest will not be paid to the Bank until 2018, DeeDees office staff did not accrue any interest.

Loan Payable - Onstar Bank

-

500,000

Loan Payable - Coldstar Bank

-

2,250,000

Need adjusting Journal entries for both questions