QUESTION 1 Eve Corparation issuesa $9000,000, 5%, 20-year mortgage note payable on December 31, 2021, to obtain needed financing for the construction of a building addition. The terms provide for annual installiment payments of $578,818 on December 31. REQUIRED: 1) Prepare the journal entries to record the mortgage loan on December 31, 2021, and the first and second installment payment. 2) Will the amount of principal reduction in the second instaliment payment be more or less than with the first installment payment?

QUESTION 1 Eve Corparation issuesa $9000,000, 5%, 20-year mortgage note payable on December 31, 2021, to obtain needed financing for the construction of a building addition. The terms provide for annual installiment payments of $578,818 on December 31. REQUIRED: 1) Prepare the journal entries to record the mortgage loan on December 31, 2021, and the first and second installment payment. 2) Will the amount of principal reduction in the second instaliment payment be more or less than with the first installment payment?

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter9: Long-term Liabilities

Section: Chapter Questions

Problem 95PSA

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