An Installment Note Payable for a Principal Amount of $94,000

question 46

Multiple Choice

An installment note payable for a principal amount of $94,000 at 6% interest requires Lawson Company to repay the principal and interest in equal annual payments of $22,315 beginning December 31, of the first year, for each of the next five years. After the final payment, the carrying amount on the note will be

• A) $1,263
• B) $21,053
• C) $22,315
• D) $0