Current Attempt in Progress The controllers of Splish Brothers, Inc. and Culver Corp. both ask you whether their companies can reclassify short-term obligations as long-term. Here are the facts surrounding both companies' short-term debt. Splish Brothers, Inc. On December 31, 2017, Splish Brothers, Inc. has $2,240,000 of short-term debt in the form of notes payable to Michaels State Bank due February 5, 2018. On January 28, 2018, Splish Brothers issued 22,400 shares of common stock at $75 per share. Splish Brothers used the proceeds of $1,680,000 from the stock issuance, along with $728,000 in cash to retire the short-term debt and associated accrued interest on February 5, 2018. Splish Brothers will issue its December 31, 2017 financial statements on February 25, 2018.
Current Attempt in Progress The controllers of Splish Brothers, Inc. and Culver Corp. both ask you whether their companies can reclassify short-term obligations as long-term. Here are the facts surrounding both companies' short-term debt. Splish Brothers, Inc. On December 31, 2017, Splish Brothers, Inc. has $2,240,000 of short-term debt in the form of notes payable to Michaels State Bank due February 5, 2018. On January 28, 2018, Splish Brothers issued 22,400 shares of common stock at $75 per share. Splish Brothers used the proceeds of $1,680,000 from the stock issuance, along with $728,000 in cash to retire the short-term debt and associated accrued interest on February 5, 2018. Splish Brothers will issue its December 31, 2017 financial statements on February 25, 2018.
Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Gary A. Porter, Curtis L. Norton
Chapter9: Current Liabilities, Contingencies, And The Time Value Of Money
Section: Chapter Questions
Problem 9.3E
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