Hornet Motors purchased a custom-made metal press for use in repairing wrecked cars.The press was installed on January 2,2016.The press had a market value of $300,000.Hornet agreed to pay for the press in three equal installments beginning December 31,2016.At the time,Hornet's incremental borrowing rate was 7%.
Required: Compute the installment payments and prepare the three year amortization table for the note payable.Prepare the journal entries to record the purchase of the machine,the first annual payment,and the final payment on the note.

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The Answer of Hornet Motors purchased a custom-made metal press for use in repairing wrecked cars.The press was installed on January 2,2016.The press had a market value of $300,000.Hornet agreed to pay for the press in three equal installments beginning December 31,2016.At the time,Hornet's incremental borrowing rate was 7%.
Required: Compute the installment payments and prepare the three year amortization table for the note payable.Prepare the journal entries to record the purchase of the machine,the first annual payment,and the final payment on the note.

Hornet Motors Purchased a Custom-Made Metal Press for Use in Repairing