On 31 December 2020, Pedro Vergel agrees on a 5-year 900,000 mortgage liability in conjunction with the purchase of a flat. This mortgage is payable in equal monthly installments.

The interest rate offered by the bank is 7% annual rate. The first monthly payment is made on 31 January 2021. This mortgage is fully amortizing over 60 months.

How much is the monthly payment? (14 points) (b) Complete the amortization table for the first four payments by entering the correct euro amounts in the blank spaces provided. (16 points) Round to the nearest euro

						Reduction in
Interest		Payment		Monthly	Interest	Unpaid	Unpaid
Period		Date		Payment	Expense	Balance	Balance
Issue date
1
2
3
4

(b) Record the first payment in the general journal. (12 points)

Date	Account Titles and Explanation	Debit	Credit