Reid & Wright Learning Center needed some long-term financing and arranged for a 10-year, $100,000, 7% mortgage loan on January 1, Year 1. Annual payments of $14,238 will be made on December 31 each year. Show the effect on the accounting equation of the second annual payment. Round to the nearest dollar. What is liability?
A. (6,493) Notes Payable
B. (7,000) Interest Expense
C. (10,000) Interest Expense
D. 0 No Effect
E. (14,238) Cash
F. (7,238) Notes Payable
G. (7,745) Cash
H. (7,745) Notes Payable
I. (6,493) Cash
J. (14,238) Notes Payable
K. (6,493) Interest Expense
Answer: H. (7,745) Notes Payable
Business
You might also like to view...
The McDonald's corporate brand name and golden arches can be classified as ________ that may potentially stimulate an individual's attention and decision about whether or not to dine at the restaurant
A) cues B) drives C) motives D) needs E) attitudes
Business
A process chart activity that changes, creates, or adds something is a(n):
A) operation. B) transportation. C) inspection. D) delay.
Business