Answered: In the December 31, 2021 balance sheet,…

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter9: Current Liabilities And Contingent Obligations

Section: Chapter Questions

Problem 6E: Short-Term Debt Expected to Be Refinanced On December 31, 2019, Excello Electric Company had 1...

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Dean Company has P2,000,000 of note payable due June 15, 2022. At the financial statement date of December 31, 2021, Dean signed an agreement to borrow up to 2,000,0000 to refinance the note payable on a long-term basis. The financing agreement called for borrowing not to exceed 80% of the value of the collateral Dean was providing. On December 31, 2021, the value of the collateral was P3,000,000. Under the existing loan facility, Dean has the discretion to refinance or roll over the note payable for at least twelve months after the balance sheet date.

In the December 31, 2021 balance sheet, what amount of the note payable should Dean report as non-current liability?

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