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Prepare an amortization schedule for the four-year period

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Question - On January 1, Year 1, Tutti-Frutti Co. borrowed cash from Alpha Bank by issuing a $100,000 face-value, four-year term note that had an 8 % annual interest rate. The note is to be repaid by making annual cash payments of $30,192 that include both interest and principal on December 31 of each year. Tutti-Frutti Co. used the proceeds from the loan to purchase land that generated rental revenues of $52,000 cash per year.

Required - For this project, complete the following:

A. Prepare an amortization schedule for the four-year period.

B. Prepare an income statement, balance sheet, and statement of cash flows for each of the four years.

C. Given that revenue is the same for each year, explain why net income increases each year.

Reference no: EM133066520

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