On January 1, 2016, Bratios Company purchased equipment and signed a six-year mortgage note for $97,000 at 15%
The note will be paid in equal annual installments of $25,631, beginning January 1, 2017. On January 1, 2017, the journal entry to record the first installment payment will include a ________. (Round your answer to the nearest whole number.)
A) debit to Mortgage Payable for $25,631
B) debit to Interest Expense for $14,550
C) credit to Cash for $11,081
D) credit to Mortgage Payable for $97,000
B .Beginning
Balance Principal
Payment Interest
Expense Total
Payment Ending
Balance
01/01/2016 $97,000
01/01/2017 $97,000 $11,081 $14,550 $25,631 85,919
01/01/2018 85,919 12,743 12,888 25,631 73,176
01/01/2019 73,176 14,655 10,976 25,631 58,521
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