Buying a building with a mortgage loan and a bank transfer

Transaction

A company buys a warehouse for $400,000.00; an appraisal assigns $100,000.00 of the price to the land it stands on. A bank grants a 20-year mortgage loan of $280,000.00, repayable in monthly installments, and pays it directly to the seller. The company pays the rest by check.

Assumptions: Closing costs and loan fees are ignored. The whole mortgage is recorded in one account; its current portion is shown separately only on the balance sheet.