(Answered) Question - on january 1 2018 stoops entertainment purchases

Accounting

Question - On January 1, 2018, Stoops Entertainment purchases a building for $540,000, paying $120,000 down and borrowing the remaining $420,000, signing a 8%, 10-year mortgage. Installment payments of $5,095.76 are due at the end of each month, with the first payment due on January 31, 2018.

1. Record the purchase of the building on January 1, 2018. Record the purchase of the building.

2. Record the purchase of the building.

3-a. Record the first monthly mortgage payment on January 31, 2018.

3-b. How much of the first payment goes to interest expense and how much goes to reducing the carrying value of the loan?

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