Question Your answer is partially correct. Try again Detwiler Orchard issues a $

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Question Your answer is partially correct. Try again Detwiler Orchard issues a $700,000, 6% 15-year mortgage note to obtain needed financing for a new lab. The terms call for annual payments o 572 074 each. Prepare the entries to record the mortgage loan and the first installment payment. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Tities and Explanation Debit Credit $700 Mortgage Payable $700,000 (To record mortgage loan) Payable Interest Expense Cash $72,074 (To record annual payment bn mortgage)

Explanation / Answer

Answer)

Journal entry to record first installment payment on mortagage:

Account titles and explanation Debit Credit Mortagage payable[$72074-interest expense] 30074 Interest expense[$700000×6%] 42000 Cash 72074

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