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View Policies Current Attempt in Progress Current assets Non-current assets require equal On June 30, 2020, Kovacs Company borrowed $410,000 at a bank by signing a five-year, 10% loan. The terms of the loan semi-annual principal payments plus interest beginning December 31, 2020. The loan agreement requires the company to maintain a current ratio of 2.5. The December 31, 2020, year-end statement of financial position, immediately prior to the bank loan repayment and the reclassification of long-term debt, follows: Total assets $205,200 511,800 $717,000 Current liabilities Loan payable Common shares Retained earnings Total liabilities and shareholders' equity $54,000 410,000 157,000 96,000 n $717,000 !!

View Policies Current Attempt in Progress Current assets Non-current assets require equal On June 30, 2020, Kovacs Company borrowed $410,000 at a bank by signing a five-year, 10% loan. The terms of the loan semi-annual principal payments plus interest beginning December 31, 2020. The loan agreement requires the company to maintain a current ratio of 2.5. The December 31, 2020, year-end statement of financial position, immediately prior to the bank loan repayment and the reclassification of long-term debt, follows: Total assets $205,200 511,800 $717,000 Current liabilities Loan payable Common shares Retained earnings Total liabilities and shareholders' equity $54,000 410,000 157,000 96,000 n $717,000 !!

Intermediate Accounting: Reporting And Analysis
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
ChapterM: Time Value Of Money Module
Section: Chapter Questions
Problem 4P: Determining Loan Repayments Jerry Rockness needs 40,000 to pay off a loan due on December 31, 2028....
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View Policies Current Attempt in Progress On June 30, 2020, Kovacs Company borrowed $410,000 at a bank by signing a five-year, 10% loan. The terms of the loan require equal semi-annual principal payments plus interest beginning December 31, 2020. The loan agreement requires the company to maintain a current ratio of 2.5. The December 31, 2020, year-end statement of financial position, immediately prior to the bank loan repayment and the reclassification of long-term debt, follows: Current assets Non-current assets Total assets $205,200 511,800 $717.000 Current liabilities Loan payable Common shares Retained earnings $54,000 410,000 157,000 96,000 Total liabilities and shareholders' equity $717,000 Does Kovacs Company comply with the current ratio requirement prior to recording the December 31 loan payment? (Round answer to 1 decimal place, e.g. 1.2.)
Transcribed Image Text:View Policies Current Attempt in Progress On June 30, 2020, Kovacs Company borrowed $410,000 at a bank by signing a five-year, 10% loan. The terms of the loan require equal semi-annual principal payments plus interest beginning December 31, 2020. The loan agreement requires the company to maintain a current ratio of 2.5. The December 31, 2020, year-end statement of financial position, immediately prior to the bank loan repayment and the reclassification of long-term debt, follows: Current assets Non-current assets Total assets $205,200 511,800 $717.000 Current liabilities Loan payable Common shares Retained earnings $54,000 410,000 157,000 96,000 Total liabilities and shareholders' equity $717,000 Does Kovacs Company comply with the current ratio requirement prior to recording the December 31 loan payment? (Round answer to 1 decimal place, e.g. 1.2.)
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