Create journal entry to record the monthly loan payment

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Question - The business borrows $550,000 from NAB Bank on 3rd March 2020 to finance the Store Building to be used for the retail business. The loan is a 7-year secured business loan, with an interest rate of 8.5% per annum and monthly repayments of $8,830 recorded on the 25th of each month. Therefore, interest is charged to the loan monthly on 25th of each month and payments of $8,830 will be made monthly on the 25th day of each month. The loan is an GST exempt transaction.

Required -

1. Use the journal entry screen to record proceeds from a business loan you received from the NAB Bank on 3 rd March 2020.

2. Create journal entry to record the monthly loan payment and the interest paid at 25th March 2020.

3. Create the month end journal entry to accrue the interest payable on the loan for March. (Make sure you create the necessary accounts required).

Reference no: EM132566742

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