On December 31, 20x4, the an entity took out a 5%, $900,000 bank loan. The loan is repayable over 4 years at equal annual repayments of $253,811 on December 31 of each year. The first payment is due on December 31, 20x5 and the last payment is due on December 31, 20x8.

Required

a. Prepare an amortization schedule for this loan

b. Prepare the journal entry at December 31, 20x7 to record the annual payment.