Problem 10-6A Installment notes LO C1

On November 1, 2017, Norwood borrows $490,000 cash from a bank by signing a five-year installment note bearing 7% interest. The note requires equal payments of $119,506 each year on October 31. (Table B.1, Table B.2, Table B.3, and Table B.4) (Use appropriate factor(s) from the tables provided.)

2. Prepare the journal entries in which Norwood records the following: (a) Accrued interest as of December 31, 2017 (the end of its annual reporting period). (b) The first annual payment on the note.

Record the interest accrued on the note as of December 31, 2017.

Note: Enter debits before credits.

Date	General Journal	Debit	Credit
Dec 31, 2017

Record the first installment payment on October 31, 2018. Assume no reversing entries were prepared.

Note: Enter debits before credits.

Date	General Journal	Debit	Credit
Oct 31, 2018