Name: Date: Brittany Adams 9/27/21 Cells highlighted in green contain a drop-down arrow; select the appropriate response from the list. When the calcuations for interest expense and principal reduction are correct, the cells will change to yellow. On January 1, 2021, X&Y Co. borrows $340,000 cash from a bank and in return signs an 8% installment note for five annual payments of $85,155 each, with the first payment due one year after the note is signed. 1. Prepare the journal entry to record issuance of the note. Credit Date General Journal 1/1/21 Cash Notes payable Debit 340,000 340.000 2 For the first $85,155 annual payment at December 31, 2021, what amount goes toward interest expense? What amount goes toward principal reduction of the note? interest expense Principal reduction