Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

9/4-You decided to purchase an office building for your business. The cost of the office was $200,000. Pig E. Bank agreed to finance the purchase

9/4-You decided to purchase an office building for your business. The cost of the office was $200,000. Pig E. Bank agreed to finance the purchase and offered you a 30-year 6.0% mortgage and required you to make a 10% down payment. You made the deposit by issuing check #104. You monthly payments will be due on the fourth of each month. The first monthly note is due on October 4.

9/30-You accrued interest on the Pig E. Bank mortgage. Use 360 days in the year to calculate the interest. The payment terms are 1/10, net 30.

10/4-You make the first monthly payment to Pig E. Bank by issuing check #110. Use your financial calculator to determine the amount of the payment, principal and interest. Show all calculations in your journal. I need the journal entry and calculations for the October 4th transaction. Thanks.

Date Account Title Debit Credit
9/4 Office Building $200,000
Notes Payable (long-term 180,000
Cash 20,000
9/30 Interest Expense $780
Interest Payable 780
10/4 I need the correct account titles and amounts plus calculations for the October 4th transaction.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions