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Problem 9-1B Record and analyze installment notes (LO9-2)
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[The following information applies to the questionsdisplayed below.]
On January 1, 2021, Stoops Entertainment purchases a buildingfor $610,000, paying $110,000 down and borrowing the remaining$500,000, signing a 9%, 15-year mortgage. Installment payments of$5,071.33 are due at the end of each month, with the first paymentdue on January 31, 2021.
Problem 9-1B Part 3
3-a. Record the first monthly mortgage paymenton January 31, 2021. (If no entry is required for aparticular transaction/event, select "No JournalEntry Required" in the first account field. Do notround intermediate calculations. Round your final answers to 2decimal places.)
Journal entry worksheet
- Record the first monthly mortgage payment.
Note: Enter debits before credits.
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| | Date | General Journal | Debit | Credit |
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| January 31, 2021 | | | | | | | | | | | | | | | | | | | | | | | |
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3-b. How much of the first payment goes tointerest expense and how much goes to reducing the carrying valueof the loan? (Round your answers to 2 decimalplaces.)
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| | Interest Expense | Reducing the Carrying Value | | First payment | | |
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4. Total payments over the 15 years are$912,839 ($5,071.33 × 180 monthly payments). How much of this isinterest expense and how much is actual payment of the loan?
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| | | Interest expense | | | Actual payments on the loan | |
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