On 1 January 2017,Bratios Company Purchased Equipment and Signed a 6-Year

Multiple Choice

On 1 January 2017,Bratios Company purchased equipment and signed a 6-year mortgage payable for $160,000 at 15%.The mortgage will be paid in equal annual instalments of $42,278,beginning 1 January 2018.The journal entry to record the first instalment payment on 1 January 2018 will include a:

A) credit to Mortgage payable for $160,000.
B) debit to Interest expense for $24,000.
C) debit to Mortgage payable for $42,278.
D) credit to Cash for $18,278.