Question

On January 1, 2018, brown co. borrowed cash from First Bank by issuing 49,500 for face value,

four-year term note that had an 8 percent annual interest rate. The note is to be repaid by making annual cash payments of $14,285 that include both interest and principal on December 31 of each year. Brown used the proceeds from the loan to purchase land that generated rental revenues of $22,275 cash per year.

A. Prepare an amortization schedule for the four-year period. (Round your answers to the nearest whole dollar amount.)

B. Prepare an income statement, balance sheet, and statement of cash flows for each of the four years. (Hint: Record the transactions for each year in T-accounts before preparing the financial statements.

BROWN CO. Amortization Schedule Cash Applied to Payments Interest December 31 Year Principal Balance on January 1 Applied to

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Answer #1

I have calculated the shedule for 8% and 6% interest Because at 8 % interest there is closing balance at 6% interest there is

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