On November 1, 2014, EZ Products borrowed $48,000 on a 5%, 10-year note with annual installment payments of $4,800 plus interest due on November 1 of each succeeding year. At the end of 2014, EZ Products accrued interest expense. No further entries were made until November 1, 2015 when the first installment payment was made. That payment included both principal and interest. Please provide the journal entry for the installment payment made on November 1, 2015.
Definitions:
Price-Control Legislation
Laws enacted by a government to regulate the prices charged for goods and services in the market, often to protect consumers.
Invisible Hand Principle
The tendency of market prices to direct individuals pursuing their own interests to engage in activities promoting the economic well-being of society.
Price-Taker Markets
Markets in which individual buyers or sellers have no influence over the price of a product, typically due to the product being a commodity with many competitors.
Low Entry Barriers
Conditions that make it easy for new competitors to enter a market, including minimal financial, regulatory, or technological requirements.
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