On July 1,2013,Avery Services Issued a 4% Long-Term Note Payable $$\begin{array} { | l | l | l | } \hline \quad\quad& \quad&\quad \\\hline & & \\\hline & & \\\hline & & \\\hline\end{array}$$

question 101

Essay

On July 1,2013,Avery Services issued a 4% long-term note payable for $10,000.It is payable over a 5-year term in $2,000 principal installments on July 1 of each year.Each yearly installment will include both principal repayment of $2,000 and interest payment for the preceding one-year period.Please provide the journal entry needed on July 1,2014 when the first installment payment is made.
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Definitions:

Medical Services

Professional care or treatment provided by doctors and other health professionals to maintain or improve health.

Marginal Tax Rate

The additional tax liability a person faces divided by his or her additional taxable income. It is the percentage of an extra dollar of income earned that must be paid in taxes. It is the marginal tax rate that is relevant in personal decision-making.

Tax Liability

The total amount of taxes an individual or organization is legally obligated to pay to a taxation authority.

Taxable Income

The amount of income used to determine how much tax an individual or a company owes to the government.