Question - Nance co. receives $396,200 when issues a $396,200, 7%, mortgage note payable to finance the construction of a building at December 31, 2014. The terms provide for semiannual installment payment of $21,542 on June 30 and December 31.
Prepare the schedule using effective interest method to amortize bond premium or discount of Nance co.
Prepare the journal entries to record the mortgage loan.
Prepare the journal entries to record the first two installment payments. This part has first installment payment and second installment payment.