Question

AccoUNTING (Me FULL SCREEN DueNorth Mining Inc. purchased some crushing equipment on July 1, 2020 for $308,000. A down payment of $28,000 was required and the remainder was financed with a 7 % instalment loarm payable over 5 years with payments made on a quarterly basis. The quarterly payments required are $16,714 and include both interest and principal. The folowing is an extract from the loan amortization table the supplier provided to DueNorth: PRINTER VERSTON BACK Beginning loan balance Ending loan Payment Dates Payment Interest Principal balance 9/30/20 $280,000 $16,714 $4.900 $11,814 $268,186 12/31/20 3/31/21 268,186 16,714 4.693 12,021 256,16 256,165 16,714 4,483 12.231 243.934 6/30/21 9/30/21 243,934 16.714 4,269 12,445 231.489 231,489 16,714 4.051 12.663 218,826 218,826 3,829 12/31/21 16,714 12.885 205,941 (a) Your answer is correct Prepare the journal entries for the purchase of the equipment and the first 2 quarterly payments in 2020 (use Long-Term Loan Payable account). (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter 0 for the amounts. Debit Credit Date Account Titles and Explanation 308000 Crushing Equipment July 1, 2020 2в000 Cash Long-Term Loan Payable

pls answer interest expense

Answer 1

Interest expense for year 2020

Only interest expense for the year 2020 will be considered to report in the payment, even though it is paid or not.

Interest amount till 9/30/20 - $ 4,900

Interest amount till 12/31/20 - $ 4,693

Total Interest for Year 2020 = 4,900 + 4,693 = $ 9,593