Use the information in Exercise 14-10 to prepare the journal entries for Eagle to record the loan on January 1, 2017, and each of the four payments from December 31, 2017, through December 31, 2020.

In Exercise 14-10

On January 1, 2017, Eagle borrows $100,000 cash by signing a four-year, 7% installment note. The note requires four equal payments of $29,523, consisting of accrued interest and principal on December 31 of each year from 2017 through 2020. Prepare an amortization table for this installment note like the one in Exhibit 14.12.

Exhibit 14.12.

Transcribed Image Text:

Payments (A) (B) Debit (C) (D) (E) Credit Debit Period Interest Notes Ending Ending Beginning Expense Balance Payable (D) – (B) Cash Balance 8% x (A) (A) – (C) Date (computed) $ 18,482 $60,000 $4,800 $23,282 $41,518 (1) 12/31/2017 (2) 12/31/2018 (3) 12/31/2019 23,282 21,557 41,518 3,321 19,961 21,557 21,557 1,725 23,282 $9,846 $60,000 $69,846 Decreasing Accrued Increasing Principal Component Equal Total Principal Interest Interest Payments $4,800 $18,482 2017 2018 $3,321 $19,961 2019 $1,725 $21,557 $5,000 $10,000 Cash Payment Pattern $15,000 $20,000 $25,000 End of Year