On January 1, 2020, Sunland Company, a calendar-year company, issued $897000 of notes payable, of whic January 1 for each of the next four years. Ignoring interest, the proper balance sheet presentation on Decer O urrent Liabilities, $448500; Long-term Debt, $448500. O Long-term Debt, $897000. O urrent Liabilities, $224250; Long-term Debt, $672750.

On January 1, 2020, Sunland Company, a calendar-year company, issued $897000 of notes payable, of whic January 1 for each of the next four years. Ignoring interest, the proper balance sheet presentation on Decer O urrent Liabilities, $448500; Long-term Debt, $448500. O Long-term Debt, $897000. O urrent Liabilities, $224250; Long-term Debt, $672750.

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, 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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