please clear writing

QUESTION 3:

The following parts are independent.

PART 1 (14 marks):On December 31, 2020, Almonte Corporation borrowed $100,000 by signing a 12% note that is to be repaid in 5 annualfixed principalrepayments, the first of which is due on December 31, 2021.

REQUIRED:

(a)preparea journal entry to record theinitial borrowingof the money.

(b)Assume that the payments are to consist ofaccrued interest plusfixedprincipalpayments. Prepare general journal entries to record thefirstandsecondinstallment payments.

(c)What amount should be shown as a current liability at December 31,2021?

(d)What amount should be shown as a long-term liability at December 31,2021?

(e)Contrary to the assumption in (b) above, assume now that the note requiresblendedinstallmentpaymentsof $27,741. Prepare the general journal entry to record the first installment payment.

PART 2 (16 marks):

On December 31, 2020, when the market rate was 10%, West End Corp. issued $5,000,000, 12%, 5-year bonds. Interest is payable semiannually on June 30 and December 31. The bonds were issued for $5,386,087, and the corporation uses the effective interest method of amortizing any bond premium or discount.

REQUIRED:

(a) Complete the amortization table below for the firsttwo periodsonly. (USE EXCEL TEMPLATE TO COMPLETEYOUR ANSWER)

Period ending

Cash interest paid

Interest expense

Premium/ Discount Amortization

Carrying value

Dec. 31/20

June 30/21

Dec. 31/21

(b)Prepare the journal entries to record theissueof the bonds and thefirst

interestpayment.

(c)West End Corp. retires its bonds on December 31, 2024 for cash of

$5,090,000. At that date the bonds have a carrying value of $5,092,971.

Prepare the journal entry to retire the bonds on December 31, 2024.