MYLAB (24 MONTHS) (FIN)
7th Edition
ISBN: 9780136505204
Author: MILLER-NOBLES
Publisher: PEARSON
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Chapter 11, Problem 3QC
To determine
Long-term notes payable: Long-term notes payable represent a legal and written promise made by the business to pay a debt with interest over a period of more than a year. It is reported under the long-term liability section of the balance sheet.
Current portion of long-term notes payable: The principal amount of notes payable which would be paid within one year is called as current portion of long-term notes payable. The current portion of long-term notes payable is reported as a current liability.
To identify: The true statement.
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Jade Larson Antiques owes $20,000 on a truck purchased for use in the business. Assume the company makes
timely principal payments of $5,000 each year at December 31 plus interest at 8%. Which of the following is true?
O A. Just before the last payment is made, $5,000 will appear as a long-term liability on the balance sheet.
OB. After the first payment is made, $5,000 would be shown as the current portion due on the long-term note.
OC. After the first payment is made, the company owes $15,000 plus three years' interest.
O D. After the first payment, $15,000 would be shown as a long-term liability.
8. A company owes $20,000 on a truck purchased. Assume the company makes timely principle payments of $5,000 each year at Dec 31st. Which of the following is true.
a. after the 1st payment is made, $5000 would be shown as the current portion due on the long term note.
b. after the 1st payment is made, the company owes $15,000 plus three years interest.
c. Just before the last payment is made $5000 will appear as a long term liability on the balance sheet.
d. after the 1st payment, $15,000 would be shown as a long term liability
A firm acquires a warehouse costing $60,000 on January 31. The firm makes a down payment of $7,000 and assumes a 20 year, 6% mortgage for the balance. Interest is payable on January 31 each year. If interest payment on mortgage is recognized on february 28th of the same year, what will be the interest payable.
Chapter 11 Solutions
MYLAB (24 MONTHS) (FIN)
Ch. 11 - On January 1, 2016, a business borrowed 18,000 on...Ch. 11 - A company sells 180,000 (selling price) of goods...Ch. 11 - Prob. 3QCCh. 11 - Prob. 4QCCh. 11 - Prob. 5QCCh. 11 - Prob. 7QCCh. 11 - Vega Company expects to pay a 4% bonus on net...Ch. 11 - Prob. 9QCCh. 11 - Prob. 10QCCh. 11 - Prob. 1RQ
Ch. 11 - What is a current liability? Provide some examples...Ch. 11 - How is sales tax recorded? Is it considered an...Ch. 11 - How do unearned revenues arise?Ch. 11 - What do short-term notes payable represent?Ch. 11 - Coltrane Company has a 5,000 note payable that is...Ch. 11 - Prob. 7RQCh. 11 - Prob. 8RQCh. 11 - Prob. 9RQCh. 11 - Prob. 10RQCh. 11 - What are the two main controls for payroll?...Ch. 11 - When do businesses record warranty expense, and...Ch. 11 - Prob. 13RQCh. 11 - Prob. 14RQCh. 11 - Prob. 15RQ
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