2. The following information is given for Airflight Airlines: As of December 31, 2015, Airflight had $10,000 of notes coming due on January 30, 2016. Also as of December 31, 2015, Airflight was negotiating to issue long-term debt so that it could use the proceeds to liquidate these short-term notes as they mature. On January 4, 2016, the company used $3,000 of excess cash to pay off part of the note. On January 29, 2016, a refinancing of the entire $10,000 was completed. The $3,000 was replaced and the rest of the notes were extended for another two years. Airflight has negotiated a long-term refinancing contract which permits Airflight to borrow an up to 60% of accounts receivable balances to refinance debt. Accounts receivable are expected to range between $12,000 and $16,000 next year. Airflight also has negotiated a new long-term refinancing contract which permits Airflight to borrow an amount up to 35% of inventory to refinance debt. Inventory is expected to rango between $75,000 and $85,000 next year. Required: On the December 31, 2015 balance sheet, how much of the $10,000 note should be shown as short-term? Airflight has a currently maturing note payable of $20,000 related to the accounts receivable refinancing contract. How much of the S20,000 note payable can be classified as long-term debt at the end of 2015? Compute the amount of the company's currently maturing note payable of $50,000 related to refinancing inventory that must be classified as short-term debt on December 31, 2015. ANSWER: 2. The following information is given for Airflight Airlines: As of December 31, 2015, Airflight had $10,000 of notes coming due on January 30, 2016. Also as of December 31, 2015, Airflight was negotiating to issue long-term debt so that it could use the proceeds to liquidate these short-term notes as they mature. On January 4, 2016, the company used $3,000 of excess cash to pay off part of the note. On January 29, 2016, a refinancing of the entire $10,000 was completed. The $3,000 was replaced and the rest of the notes were extended for another two years. Airflight has negotiated a long-term refinancing contract which permits Airflight to borrow an up to 60% of accounts receivable balances to refinance debt. Accounts receivable are expected to range between $12,000 and $16,000 next year. Airflight also has negotiated a new long-term refinancing contract which permits Airflight to borrow an amount up to 35% of inventory to refinance debt. Inventory is expected to rango between $75,000 and $85,000 next year. Required: On the December 31, 2015 balance sheet, how much of the $10,000 note should be shown as short-term? Airflight has a currently maturing note payable of $20,000 related to the accounts receivable refinancing contract. How much of the S20,000 note payable can be classified as long-term debt at the end of 2015? Compute the amount of the company's currently maturing note payable of $50,000 related to refinancing inventory that must be classified as short-term debt on December 31, 2015