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Riley Company issued a $2,500,000, 10%, 10-year mortgage note payable to finance the construction of a building at December 31, 2011

Accounting

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Riley Company issued a $2,500,000, 10%, 10-year mortgage note payable to finance the construction of a building at December 31, 2011. The terms provide for semiannual installment payments of $200,608.

Instructions

Prepare the entry to record:

(a)   the mortgage loan on December 31, 2011.

(b)   the first installment payment.