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Problem
Kellerman Company purchased a building and land with a fair market value of $525,000 (building, $300,000 and land, $225,000) on January 1, 2016. Kellerman signed a 15-year, 10% mortgage payable. Kellerman will make monthly payments of $5,641.68.
Requirements:
1. Journalize the mortgage payable issuance on January 1, 2016.
2. Prepare an amortization schedule for the first two payments.
3. Journalize the first payment on January 31, 2016.
4. Journalize the second payment on February 29, 2016.
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