Thayer Company purchased a building on January 2 by signing a long-term $3,360,000 mortgage with monthly payments of $30,800.The mortgage carries an interest rate of 10 percent.The entry to record the mortgage will include a
A)debit to the Cash account for $3,360,000.
B)credit to the Cash account for $3,360,000.
C)debit to the Mortgage Payable account for $3,360,000.
D)credit to the Mortgage Payable account for $3,360,000.

Question

Quizplus · Accepted Answer

The entry to record the mortgage will include a credit to the Mortgage Payable account for $3,360,000, as this represents the liability incurred by the company.

Thayer Company Purchased a Building on January 2 by Signing