Broad Street Company borrows $975,050 by issuing an 8%, 7-year note on January 1, 2018. Broad Street

Question:

Broad Street Company borrows $975,050 by issuing an 8%, 7-year note on January 1, 2018. Broad Street must make payments of principal and interest every 6 months beginning June 30, 2018. The note will be fully paid at maturity on December 31, 2024. The company's fiscal year ends on December 31.

Required

a. Prepare the journal entry to record the issuance of the note payable.

b. Prepare an amortization table.

c. Prepare the journal entry to record payments for the first year.

d. What is the amount of the note payable on the balance sheet at December 31, 2018? What is the interest expense for the year?

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial... Maturity
Maturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest...

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