On July 1, 2021, HAZELNUT Company acquired machinery worth ₱2,500,000 from PINE NUTS Corporation. Terms of the contract calls for a downpayment of ₱500,000 and signing a 2-year 10% note payable for the balance. Interest is payable quarterly. The existing loan agreement does not carry a provision to refinance. During September, HAZELNUT was experiencing financial difficulty and was unable to pay the periodic interest. What total amount of current liability should HAZELNUT report in its December 31, 2021 statement of financial position assuming PINE NUT agreed at report date not to demand payment as a consequence of the breach?
On July 1, 2021, HAZELNUT Company acquired machinery worth ₱2,500,000 from PINE NUTS Corporation. Terms of the contract calls for a downpayment of ₱500,000 and signing a 2-year 10% note payable for the balance. Interest is payable quarterly. The existing loan agreement does not carry a provision to refinance. During September, HAZELNUT was experiencing financial difficulty and was unable to pay the periodic interest. What total amount of current liability should HAZELNUT report in its December 31, 2021 statement of financial position assuming PINE NUT agreed at report date not to demand payment as a consequence of the breach?
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
Chapter14: Financing Liabilities: Bonds And Long-term Notes Payable
Section: Chapter Questions
Problem 28E: On January 1, 2019, Northfield Corporation becomes delinquent on a 100,000, 14% note to First...
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On July 1, 2021, HAZELNUT Company acquired machinery worth ₱2,500,000 from PINE NUTS Corporation. Terms of the contract calls for a downpayment of ₱500,000 and signing a 2-year 10% note payable for the balance. Interest is payable quarterly. The existing loan agreement does not carry a provision to refinance. During September, HAZELNUT was experiencing financial difficulty and was unable to pay the periodic interest. What total amount of current liability should HAZELNUT report in its December 31, 2021
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