Steven Fu has just approached a venture capitalist for financing for his new business venture, the development of a wireless golf buggy. On 1 July 2017, Steven borrowed $200 000 at an annual interest rate of 12%. The loan is repayable over 5 years in annual instalments of $55 480, principal and interest, due on 30 June each year. The first payment is due on 30 June 2018. Steven uses the effective-interest method for amortising debt. His wireless golf buggy entity’s year-end will be
30 June.
Required
1. Prepare a mortgage schedule for the 5 years, 2017–2022. Round all calculations to the nearest dollar.
2. Prepare all journal entries for Steven Fu for the first 2 fiscal years ended 30 June 2018 and 30 June 2019. Round all calculations to the nearest dollar.
3. Show the statement of financial position presentation of the loan payable as of 30 June 2019. (Hint: Be sure to distinguish between the current and long-term portions of the loan.)
