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On January 1, 2019, ABC Company borrowed $120,000 from the bank. The loan is a 7-year...

On January 1, 2019, ABC Company borrowed $120,000 from the bank. The loan
is a 7-year note payable that requires annual payments of $24,500 every
December 31, beginning December 31, 2019. Assume the loan has an interest
rate of 10% compounded annually.

Calculate the balance in the note payable account at December 31, 2020.
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Answer #1
Year Beginning Balance Interest @10% Instalment Ending Balance
2019 $                1,20,000 $                12,000 $        24,500 $         1,07,500
2020 $                1,07,500 $                10,750 $        24,500 $             93,750

Answer is $93750

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