Winter Company purchased a building on January 2 by signing a long-term $630,000 mortgage with monthly payments of $5,400. The mortgage carries an interest rate of 10 percent. The entry to record the first monthly payment will include a
A) debit to the Cash account for $5,400.
B) credit to the Cash account for $5,250.
C) debit to the Interest Expense account for $5,250.
D) credit to the Mortgage Payable account for $5,400.

Question

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The Answer of Winter Company purchased a building on January 2 by signing a long-term $630,000 mortgage with monthly payments of $5,400. The mortgage carries an interest rate of 10 percent. The entry to record the first monthly payment will include a
A) debit to the Cash account for $5,400.
B) credit to the Cash account for $5,250.
C) debit to the Interest Expense account for $5,250.
D) credit to the Mortgage Payable account for $5,400.

Winter Company Purchased a Building on January 2 by Signing