Exhibit 4 example for part A

EX 10-21 Entries for instaliment note transactions On January 1 of Year 1, Bryson Company obtained a $147,750, four-year, 7% installment n Campbell Bank. The note requires annual payments of $43,620, beginning on December 31 ote from er 31 of PLATE Year 1. a. Prepare a table for this installment note, similar to the one presented in Exhibit 4. Round to the nearest dollar b. Journalize the entries for the issuance of the note and the four annual note payments. Describe how the annual note payment would be reported on the Year 1 income C. statement. Chapter 10 Las Cument Instaliment Notes, and Continger Exhibit 4 Allocation of Periodic Payments Decrease Dece mber 31 Carrying Amount A-D) $19,742 15,229 10445 5,374 January 1 Payment Car Carrying Interest Expense (6% of January 1 in Notes Payable (B- C) Note nt) For the Year Ending December 31 Note Carrying Amou (cash paid) 5,698 5,698 5,698 $ 1,440 (6% of$24,000) 1,185 (6% of $19,742) 914 (6% of $15,229) 627 (6% of S 10,445) 324"(6% of $5,374) $ 4,258 4,513 4,784 5,071 Amount 5 5,698 Year 1 Near 2 Near 3 $24,000 19,742 15,229 Year 4 Year S 10.445 5,374 $28,490 $4,490 $24,000 Rounded (S5,698-55,374) 1. The January 1 carrying value (Column A) for Year 1 equals the bank. The January I balance in the following years equals the December 31 bal prior year amount borrowed fro m the ance from the ins constant at 85 698 the annual cash nayment reqmisod