Problem 7-31A (Algo) Accounting for an installment note payable LO 7-5 The following transactions apply to Pecan Co, for Year 1. its first year of operations: 1. Received $34.000 cash in exchange for issuance of common stock. 2. Secured a $102,000 ten-year installment loan from State Bank. The interest rate is 5 percent and annual payments are $13,209 3. Purchased land for $26.000 4. Provided services for $85.000 5. Paid other operating expenses of $50,000 6. Paid the annual payment on the loan. Required a. Organize the transaction data in accounts under an accounting equation. b. Prepare an income statement and balance sheet for Year 1. c. What is the interest expense for Year 2? Year 3? Complete this question by entering your answers in the tabs below. Req A Reg B Inc Stmt Req B Bal Sheet Reg C Organize the transaction data in accounts under an accounting equation. (Enter any decreases to account balances is no effect on the Account Titles for Retained Earnings, leave the cell blank. Not al cells will require entry) Assets PECAN COMPANY Effect of Events on the Accounting Equation Liabilities Stockholders' Equity Note Common Retained Payable Stock Earnings + Event No. Account Titles for Retained Earnings Cash + Land + + Year 1 1. + 2. + 3. + 4. - + 5. + + 6. + + Bal. 0 0 0+ 0 + 0 Reg B Inc Stmt > Complete this question by entering your answers in the tabs below. Reg A Reg B Inc Stmt Req B Bal Sheet Reg C Prepare an income statement for Year 1. PECAN COMPANY Income Statement For the Year Ended December 31, Year 1 Non-operating items: HU Req A Reg C Stmt Sheet Prepare a balance sheet for Year 1. PECAN COMPANY Balance Sheet As of December 31, Year 1 Assets Total assets $ 0 Liabilities Total liabilities Stockholders' Equity 0 Total stockholders' equity Total liabilities and stockholders' equity 0 Complete this question by entering your answers in the tabs below. Reg A Req B Inc Stmt Req B Bal Sheet Reqc What is the interest expense for Year 2? Year 3? (Round your answers to the nearest who Year 2 Year 3 Interest expense