AKBANK extends a commercial loan to HURRIYET in the amount of $20,000,000 on November 10, 2021. The loan has a term of 5 years. The annual interest on the loan is 11%. HURRIYET will make annual interest payments, and the first interest payment will be on November 9, 2022. The principal amount is due at maturity.

Required:

1. What is the entry that should be made by HURRIYET on November 10, 2021?

2. What is the entry that should be made by AKBANK on November 10, 2021?

3. What is the entry that should be made by HURRIYET on December 31, 2021?

4. What is the entry that should be made by AKBANK on December 31, 2021?

5. What is the effect of November 10, 2021 entry on HURRIYETs balance sheet?

6. What is the effect of November 10, 2021 entry on AKBANKs balance sheet?

7. What is the effect of December 31, 2021 entry on HURRIYETs balance sheet?

8. What is the effect of December 31, 2021 entry on AKBANKs balance sheet?

9. How will HURRIYETs balance sheet be affected if December 31, 2021 entry is skipped?

10. How will AKBANKs balance sheet be affected if December 31, 2021 entry is skipped?