On August 31, 2009, XYZ Company incurs a 30-year $600,000 mortgage liability in conjunction with the purchase of a hotel. This mortgage is payable in equal monthly installments of $6,485, which include interest computed at an annual rate of 12%. The first monthly payment is made on September 30, 2009. This mortgage is fully amortizing over 360 months.

4.1 Complete the amortization table for year 2009 of the mortgage by entering the correct dollar amounts in the blank spaces provided.

Payment Monthly Interest Repayment of Unpaid

Date Payment Expense Principal Balance

Issuance $600,000

Sep 30, 2009

Oct 31, 2009

Nov 30, 2009

Dec 31, 2009

4.2 In addition, answer the below questions:

1. With respect to this mortgage, determine the amount of interest expense included in XYZ's 2009 income statement for the period ending Dec 31, 2009. (Do not separate into current and long-term portions.)
2. With respect to this mortgage, determine the amount of total liability included in XYZs 2009 balance sheet, as at Dec 31, 2009. (Do not separate into current and long-term portions.)
3. With respect to this mortgage, determine the aggregate monthly cash payments XYZ will make over the 30-year life of the mortgage.
4. With respect to this mortgage, determine the amount XYZ will pay for interest over the 30-year life of the mortgage.