On January 1, 2019, XYZ Company contracted Y Construction Co. to construct a building for $2,800,000 on land costing $200,000 (purchased from the contractor and included in the first payment). XYZ made the following payments to the construction company during 2019. January 1 420,000 March 1 600,000 May 1 1,080,000 December 31 900,000 Y Construction completed the building, ready for occupancy, on December 31, 2019. XYZ had the following debt outstanding at December 31, 2019. Specific Construction Debt 1. 1,500,000, 15%, 3-year note to finance purchase of land and construction of the building, dated December 31, 2018, with interest payable annually on December 31 Other Debt 2. 1,100,000, 10%, 5-year note payable, dated December 31, 2015, with interest payable annually on December 31 3. 1,200,000, 12%, 10-year bonds issued December 31, 2014, with interest payable annually on December 31 Instruction: Record the necessary journal entries for XYZ books?
On January 1, 2019, XYZ Company contracted Y Construction Co. to construct a building for $2,800,000 on land costing $200,000 (purchased from the contractor and included in the first payment). XYZ made the following payments to the construction company during 2019.
January 1 420,000
March 1 600,000
May 1 1,080,000
December 31 900,000
Y Construction completed the building, ready for occupancy, on December 31, 2019. XYZ had the following debt outstanding at December 31, 2019.
Specific Construction Debt
1. 1,500,000, 15%, 3-year note to finance purchase of land and construction of the building, dated December 31, 2018, with interest payable annually on December 31
Other Debt
2. 1,100,000, 10%, 5-year note payable, dated December 31, 2015, with interest payable annually on December 31
3. 1,200,000, 12%, 10-year bonds issued December 31, 2014, with interest payable annually on December 31
Instruction:
Record the necessary
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