Financial accounting 16th Edition by Jan Williams,Susan Haka,Mark Bettner ,Joseph Carcello

تمرين 66

On September 1, 2015, Speedy Lube signed a 30-year, $1,080,000 mortgage note payable to Jonstown Bank and Trust in conjunction with the purchase of a building and land.he mortgage note calls for interest at an annual rate of 12 percent (1 percent per month).he note is fully amortizing over a period of 360 months.
The bank sent Speedy Lube an amortization table showing the allocation of monthly payments between interest and principal over the life of the loan. small part of this amortization table is illustrated below.For convenience, amounts have been rounded to the nearest dollar.)

Instructions
a.xplain whether the amounts of interest expense and the reductions in the unpaid principal are likely to change in any predictable pattern from month to month.
b.repare journal entries to record the first two monthly payments on this mortgage.
c.omplete this amortization table for two more monthly installments-those due on December 1, 2015, and January 1, 2016.Round amounts to the nearest dollar.)
d.ill any amounts relating to this 30-year mortgage be classified as current liabilities in Speedy Lube's December 31, 2015, balance sheet Explain, but you need not compute any additional dollar amounts.