Question

Entries for installment note transactions Instructions Chart of Accounts Journal Instructions Journal On January 1, Year 1, Luzak Company issued a $184,000, five-year, 8% installment note to McGee Bank. The note requires annual payments of $46,084, beginning on December 31, Year 1 Journalize the entries to record the transactions. Refer to the Chart of Accounts Journalize the entries to record the following transactions. Refer to the Chart of Accounts for exact wording of account titles. JOURNAL DATE DESCRIPTION Year 1 Jan. Dec. 1 Issued the note for cash at its face amount Paid the annual payment on the note, which consisted of interest of $14,720 and principal of $31,364 31 Year 4 Dec. 31 Paid the annual payment on the note, which included $6,574 of interest. The remainder of the payment reduced the principal balance on the note

Answer 1

Answer:

Date	GeneralJournal	Debit($)	Credit($)
Year-1 Jan.1	Cash	1,84,000
	Note Payable		1,84,000
	(To record Notepayable issued at face amount)
Year-1 Dec.31	Interest Expense	14,720
	Note Payable	31,364
	Cash		46,084
	(To record year-1's annual installment on note payable)
Year-4 Dec.31	Interest Expense	6,574
	Note Payable(Bal fig.)	39,510
	Cash		46,084
	(To record year-4's annual installment on note payable)