On December 31, 2018, Latches Corp purchases a building for $350,000, paying $42

Question

On December 31, 2018, Latches Corp purchases a building for $350,000, paying $42,500 in cash and signing a 30-year mortgage for $307,500, taken out at 5% interest that is payable in monthly payments of $1,650, which includes principal and interest beginning January 31, 2019 Please complete the following: The entry to record the purchase of the building b. a. The Mortgage Payable Amortization schedule for the first payment The first monthly payment on January 31, 2019. c. Round to 2 decimal places) Date Dec. 31, 2018 Debit Credit Account and Explanation Beg. Bal | Principal | Interest 5% | Cash | End. Bal. 12/31/2018 1/31/2019 Date Account and Explanation Debit Credit Jan. 31, 2019 A1 Exam 3A S18, Page 9

Explanation / Answer

problem 6A Date Account and Explanation Debit Credit 12/31/2018 building 350,000 cash 42,500 Mortgage payable 307,500 Beg. principal interest Cash End bal 5% bal 12/31/2018 307,500 1/31/2019 307,500 368.75 1281.25 1,650 307,131 Date Account and Explanation Debit Credit 1/31/2019 Mortgage payable 368.75 interest expense 1281.25 cash 1,650

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