In 2019, Rouchele Co. borrowed $200,000 on a 5% long-term note payable. In each of the following years, Rouchele Co. will pay $25,000 towards the principal plus accrued interest, starting in 2020. Rouchele Co. has a year-end of December 31. Based on this information, Rouchele Co. will report which of the following on its 2019 balance sheet? O $200,000 as long-term debt. O $225,000 as long-term debt. $200,000 as current portion of long-term debt. $25,000 as long-term debt. $25,000 as current portion of long-term debt.

In 2019, Rouchele Co. borrowed $200,000 on a 5% long-term note payable. In each of the following years, Rouchele Co. will pay $25,000 towards the principal plus accrued interest, starting in 2020. Rouchele Co. has a year-end of December 31. Based on this information, Rouchele Co. will report which of the following on its 2019 balance sheet? O $200,000 as long-term debt. O $225,000 as long-term debt. $200,000 as current portion of long-term debt. $25,000 as long-term debt. $25,000 as current portion of long-term debt.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 1PA: On January 1, 2018, King Inc. borrowed $150,000 and signed a 5-year, note payable with a 10%...

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On January 1, 2018, King Inc. borrowed $150,000 and signed a 5-year, note payable with a 10% interest rate. Each annual payment is in the amount of $39,569 and payment is due each Dec. 31. What is the journal entry on Jan. 1 to record the cash received and on Dec. 31 to record the annual payment? (You will need to prepare the first row in the amortization table to determine the amounts.)
On January 1, 2019, Park Company accepted a 36,000, non-interest-bearing, 3-year note from a major customer in exchange for used equipment. The equipment had originally cost Park 200,000 and had a book value of 20,000 on the date of the sale. At the 12% imputed interest rate for this type of loan, the present value of the note is 25,500 on January 1, 2019. Park uses the effective interest rate. What is the carrying value of the note receivable on Parks December 31, 2019, balance sheet? a. 28,560 b. 29,000 c. 32,500 d. 36,000
Spath Company borrows 75,000 by issuing a 4-year, noninterest-bearing note to a customer on January 1, 2019. In addition, Spath agrees to sell inventory to the customer at reduced prices over a 5-year period. Spaths incremental borrowing rate is 12%. The customer agrees to purchase an equal amount of inventory each year over the 5-year period so that a straight-line method of revenue recognition is appropriate. Required: Prepare the journal entries on Spaths books for 2019 and 2020. (Round answers to 2 decimal places.)
On January 1, 2019, Northfield Corporation becomes delinquent on a 100,000, 14% note to First National Bank, on which 16,651 of interest has accrued. On January 2, 2019, the bank agrees to restructure the note. It forgives the accrued interest, extends the repayment date to December 31, 2021, and reduces the interest rate to 10%. Required: Prepare a schedule for Northfield to compute the annual interest expense in regard to the preceding note for each year of the restructuring agreement.
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Chemical Enterprises issues a note in the amount of $156,000 to a customer on January 1, 2018. Terms of the note show a maturity date of 36 months, and an annual interest rate of 8%. What is the accumulated interest entry if 9 months have passed since note establishment?