Problem: On November 1, 2019, Norwood borrows $200,000 cash from a bank by signing a five-year...

Problem:

On November 1, 2019, Norwood borrows $200,000 cash from a bank by signing a five-year installment note bearing 8% interest. The note requires equal payments of $50,091 each year on October 31.

Question:

Record the first installment payment on October 31, 2020. Assume no reversing entries were prepared. (PS i already looked for the answer in chegg and tried them but it keeps saying it's wrong... the two accounts used in this problem are interest expense and interest payable. I got interest expense which is the $13,333, but interest payable isn't the same and I cannot seem to find the right answer)

Expert Solution

First I am providing Calculation for Interest Expense for the year ended December 31, 2019 and Interest Expense for the yer 2020 upto date of first installment on October 31.

Here is Calculation Part

Now I am Providing Journal Entry for accrued interest expense , it will tell you amount of Interest Payable.

See Journal Entry Below

Finally the Journal Entry for the payment of First Installment as on October 31, 2020 as follows

ekkarill92 answered 1 year ago

On November 1, 2019, Norwood borrows $590,000 cash from a bank by signing a five-year installment...

On November 1, 2019, Norwood borrows $590,000 cash from a bank by signing a five-year installment note bearing 7% interest. The note requires equal payments of $143,895 each year on October 31. Required: 1. Complete an amortization table for this installment note. 2. Prepare the journal entries in which Norwood records the following: (a) Accrued interest as of December 31, 2019 (the end of its annual reporting period). (b) The first annual payment on the note. Complete an amortization table...

On November 1, 2019, Norwood borrows $580,000 cash from a bank by signing a five-year installment...

On November 1, 2019, Norwood borrows $580,000 cash from a bank by signing a five-year installment note bearing 5% interest. The note requires equal payments of $133,965 each year on October 31. Required: 1. Complete an amortization table for this installment note. 2. Prepare the journal entries in which Norwood records the following: (a) Accrued interest as of December 31, 2019 (the end of its annual reporting period). (b) The first annual payment on the note.

Chapter 10 Question 2: On November 1, 2017, Norwood borrows $410,000 cash from a bank by...

Chapter 10 Question 2: On November 1, 2017, Norwood borrows $410,000 cash from a bank by signing a five-year installment note bearing 9% interest. The note requires equal payments of $105,407 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.) Required: 1. Complete an amortization table for this installment note. 2. Prepare the journal entries in which Norwood records the following: (a) Accrued interest as of December 31,...

Problem 14-6A Installment notes LO C1 On November 1, 2017, Norwood borrows $430,000 cash from a...

Problem 14-6A Installment notes LO C1 On November 1, 2017, Norwood borrows $430,000 cash from a bank by signing a five-year installment note bearing 5% interest. The note requires equal payments of $99,319 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.) Required: 1. Complete an amortization table for this installment note. 2. Prepare the journal entries in which Norwood records the following: (a) Accrued interest as of...

XYZ Co. borrows $105,000 cash on November 1 of the current year by signing a 120-day,...

XYZ Co. borrows $105,000 cash on November 1 of the current year by signing a 120-day, 9%, $105,000 note. 1. On what date does this note mature? 1a. What is the amount of interest expense in the current year and the following year from this note? 1b. Prepare journal entries to record (a) issuance of the note, (b) accrual of interest on December 31, and (c) payment of the note at maturity. 1. On what date does this note mature?...

Keesha Co. borrows $155,000 cash on November 1, 2017, by signing a 180-day, 11% note with...

Keesha Co. borrows $155,000 cash on November 1, 2017, by signing a 180-day, 11% note with a face value of $155,000. 1. On what date does this note mature? (Assume that February has 28 days) April 25, 2018. April 26, 2018. April 27, 2018. April 28, 2018. April 30, 2018. 2. & 3. What is the amount of interest expense in 2017 and 2018 from this note? (Use 360 days a year. Round final answers to the nearest whole dollar.)...

Lola Co. borrows $120,000 cash on November 1, 2015, by signing a 90-day, 9% note with...

Lola Co. borrows $120,000 cash on November 1, 2015, by signing a 90-day, 9% note with a face value of $120,000. 1.) On what date does this note mature? 2.) How much interest expense results from this note in 2015? 3.) How much interest expense results from this note in 2016? 4.) Prepare journal entries to record (a) issuance of the note, (b) accrual of interest at the end of 2015, and (c) payment of the note at matutity.

4. A U.S. company borrows HK$1,000,000 from a Hong Kong bank on November 1, 2019, when...

4. A U.S. company borrows HK$1,000,000 from a Hong Kong bank on November 1, 2019, when the spot rate is $0.127/HK$. The loan carries an interest rate of 3%, and principal and interest are due on April 1, 2020, in Hong Kong dollars. The spot rate on December 31, the company’s year-end, is $0.128/HK$. On April 1, the company pays principal and interest to close the loan. The spot rate on April 1 is $0.124/HK$. The average spot rate for...

A borrower borrows on a five year loan $5,000 from a bank at 10% and will...

A borrower borrows on a five year loan $5,000 from a bank at 10% and will pay back the loan in ten equal $ payments (semi-annually) at the end of each time period. How much is each equal payment, how much principal and interest is paid back, and how much interest is paid back?

Keesha Co. borrows $225,000 cash on December 1 of the current year by signing a 180-day,...

Keesha Co. borrows $225,000 cash on December 1 of the current year by signing a 180-day, 10%, $225,000 note. 1. On what date does this note mature? 2. & 3. What is the amount of interest expense in the current year and the following year from this note? 4. Prepare journal entries to record (a) issuance of the note, (b) accrual of interest on December 31, and (c) payment of the note at maturity. Complete this question by entering your...

Question