Glen pool club inc has a 149000 mortgage liability the, Ask an Expert

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Glen Pool Club, Inc., has a $149,000 mortgage liability. The mortgage is payable in monthly installments of $2,100, which include interest computed at an annual rate of 12 percent (1 percent monthly).

a.	Prepare a partial amortization table showing (1) the original balance of this loan, and (2) the allocation of the first two monthly payments between interest expense and the reduction in the mortgage's unpaid balance. (Omit the "$" sign in your response.)

Amortization Table
Monthly Interest Period	(A) Monthly Payment	(B) Interest Expense	Reduction in Unpaid Balance	Unpaid Balance
Original balance	-	-	-	$
1	$	$	$
2

b.	Prepare the journal entry to record the second monthly payment. (Omit the "$" sign in your response.)

General Journal	Debit	Credit
Interest expense
Mortgage payable
Cash

Will monthly interest increase, decrease, or stay the same over the life of the loan?

	Increase
	Stay the same
	Decrease

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9950507

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