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Exercise 10-2A Amortization schedule for an installment note LO 10-1 On January

ID: 2528091 • Letter: E

Question

Exercise 10-2A Amortization schedule for an installment note LO 10-1 On January 1, 2016, Beatie Co. borrowed $350,000 cash from Central Bank by issuing a five-year, 5 percent note. The principal and interest are to be paid by making annual payments in the amount of $80,841. Payments are to be made December 31 of each year, beginning December 31, 2016 Required Prepare an amortization schedule for the interest and principal payments for the five-year period. (Round your answers to the nearest dollar amount.) BEATIE Cco Amortization Schedule $350,000, 5-Yr. Term Note, 5% Interest Rate Prin. Bal on Jan. 1 Cash Pay. Dec. 31 Applied to Interest Applied to Principal Prin. Bal End of Period year 2016 2017 2018 2019 2020

Explanation / Answer

Beatie Co ‘s Amortization schedule ( $ 350000, 5-year term note, 5% interest rate )

Year

Principal on jan1

Cash pay

Dec 31

Applied to Interest

Applied to Principal

Principal bal. End of Period

2016

$ 350000

$ 80841

$ 17500

$ 63341

$ 286659

2017

$ 286659

$ 80841

$ 14333

$ 66508

$ 220151

2018

$ 220151

$ 80841

$ 11008

$ 69833

$ 150318

2019

$ 150318

$ 80841

$ 7516

$ 73325

$ 76993

2020

$ 76993

$ 80841

$ 3850

$ 76991

$ 0

Notes : -

Year

Principal on jan1

Cash pay

Dec 31

Applied to Interest

Applied to Principal

Principal bal. End of Period

2016

$ 350000

$ 80841

$ 17500

$ 63341

$ 286659

2017

$ 286659

$ 80841

$ 14333

$ 66508

$ 220151

2018

$ 220151

$ 80841

$ 11008

$ 69833

$ 150318

2019

$ 150318

$ 80841

$ 7516

$ 73325

$ 76993

2020

$ 76993

$ 80841

$ 3850

$ 76991

$ 0