A B D January 1 Carrying Interest Expense (6% of January 1 Note Carrying Amount) December 31 Decrease in Year Ending Notes Payable (B – C) $ 4,258 Note Payment (Cash Paid) $ 5,698 Carrying Amount (A – D) December 31 Amount $ 1,440 (6% of $24,000) (6% of $19,742) $24,000 20Y4 $19,742 20Y5 5,698 4,513 19,742 1,185 15,229 (6% of $15,229) 20Υ6 5,698 15,229 914 4,784 10,445 (6% of $10,445) 20Υ7 10,445 5,698 627 5,071 5,374 5,698 $28,490 324* (6% of $5,374) 20Υ8 5,374 5,374 $4,490 $24,000 *Rounded ($5,374 – $5,698).
A B D January 1 Carrying Interest Expense (6% of January 1 Note Carrying Amount) December 31 Decrease in Year Ending Notes Payable (B – C) $ 4,258 Note Payment (Cash Paid) $ 5,698 Carrying Amount (A – D) December 31 Amount $ 1,440 (6% of $24,000) (6% of $19,742) $24,000 20Y4 $19,742 20Y5 5,698 4,513 19,742 1,185 15,229 (6% of $15,229) 20Υ6 5,698 15,229 914 4,784 10,445 (6% of $10,445) 20Υ7 10,445 5,698 627 5,071 5,374 5,698 $28,490 324* (6% of $5,374) 20Υ8 5,374 5,374 $4,490 $24,000 *Rounded ($5,374 – $5,698).
Corporate Financial Accounting
14th Edition
ISBN:9781305653535
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
Chapter10: Liabilities: Current, Installment Notes, And Contingencies
Section: Chapter Questions
Problem 10.1BE: Proceeds from notes payable On January 26, Nyree Co. borrowed cash from Conrad Bank by issuing a...
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Question
On January 1, Year 1, Bryson Company obtained a $147,750, four-year, 7% installment note from Campbell Bank. The note requires annual payments of $43,620, beginning on December 31, Year 1.
a. Prepare an amortization table for this installment note, similar to the one presented in Exhibit 4.
b.
c. Describe how the annual note payment would be reported in the Year 1 income statement.
Exhibit 4 Attached
![A
B
D
January 1
Carrying
Interest Expense (6% of
January 1 Note Carrying
Amount)
December 31
Decrease in
Year Ending
Notes Payable
(B – C)
$ 4,258
Note Payment
(Cash Paid)
$ 5,698
Carrying
Amount (A – D)
December 31
Amount
$ 1,440
(6% of $24,000)
(6% of $19,742)
$24,000
20Y4
$19,742
20Y5
5,698
4,513
19,742
1,185
15,229
(6% of $15,229)
20Υ6
5,698
15,229
914
4,784
10,445
(6% of $10,445)
20Υ7
10,445
5,698
627
5,071
5,374
5,698
$28,490
324* (6% of $5,374)
20Υ8
5,374
5,374
$4,490
$24,000
*Rounded ($5,374 – $5,698).](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fea8dfc85-436b-4e5a-b180-9f611d744370%2F75fb2a6f-aa46-4a88-9f0e-cf4fc558f39c%2Fhb31ck.jpeg&w=3840&q=75)
Transcribed Image Text:A
B
D
January 1
Carrying
Interest Expense (6% of
January 1 Note Carrying
Amount)
December 31
Decrease in
Year Ending
Notes Payable
(B – C)
$ 4,258
Note Payment
(Cash Paid)
$ 5,698
Carrying
Amount (A – D)
December 31
Amount
$ 1,440
(6% of $24,000)
(6% of $19,742)
$24,000
20Y4
$19,742
20Y5
5,698
4,513
19,742
1,185
15,229
(6% of $15,229)
20Υ6
5,698
15,229
914
4,784
10,445
(6% of $10,445)
20Υ7
10,445
5,698
627
5,071
5,374
5,698
$28,490
324* (6% of $5,374)
20Υ8
5,374
5,374
$4,490
$24,000
*Rounded ($5,374 – $5,698).
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