On February 10, 2021, after issuance of its financial statements for 2020, Ikli Company entered into a financing agreement with Leo Bank, allowing Ikli Company to borrow up to P6,000,000 at any time through 2023. Amounts borrowed under the agreement bear interest at 2% above the bank's prime interest rate and mature two years from the date of loan. Ikli Company presently has P2,250,000 of notes payable with First National Bank maturing March 15, 2021. The company intends to borrow P3,750,000 under the agreement with Leo and liquidate the notes payable to First National. The agreement with Leo also requires Ikli to maintain a working capital level of P9,000,000 and prohibits the payment of dividends to ordinary shareholders without prior approval by Leo Bank. From the above information only, the total current liabilities of Ikli Company as of the December 31, 2020 is a. P0 c. P3,000,000 b. P2,250,000 d. P6,000,000
On February 10, 2021, after issuance of its financial statements for 2020, Ikli Company entered into a financing
agreement with Leo Bank, allowing Ikli Company to borrow up to P6,000,000 at any time through 2023. Amounts
borrowed under the agreement bear interest at 2% above the bank's prime interest rate and mature two years from the
date of loan. Ikli Company presently has P2,250,000 of notes payable with First National Bank maturing March 15, 2021.
The company intends to borrow P3,750,000 under the agreement with Leo and liquidate the notes payable to First
National. The agreement with Leo also requires Ikli to maintain a
payment of dividends to ordinary shareholders without prior approval by Leo Bank. From the above information only, the
total current liabilities of Ikli Company as of the December 31, 2020 is
a. P0 c. P3,000,000
b. P2,250,000 d. P6,000,000
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