Question
On December 31, 2021, L Inc. had a $1,600,000 note payable outstanding, due July 31, 2022. L borrowed the money to finance construction of a
On December 31, 2021, L Inc. had a $1,600,000 note payable outstanding, due July 31, 2022.
L borrowed the money to finance construction of a new plant.
L planned to refinance the note by issuing long-term bonds.
Because L temporarily had excess cash, it prepaid $510,000 of the note on January 23, 2022.
In February 2022, L completed a $3,100,000 bond offering.
L will use the bond offering proceeds to repay the note payable at its maturity and to pay construction costs during 2022.
On March 13, 2022, L issued its 2021 financial statements.
What amount of the note payable should L include in the current liabilities section of its December 31, 2021, balance sheet?
Step by Step Solution
3.41 Rating (145 Votes )
There are 3 Steps involved in it
Step: 1
To determine the amount of the note payable that should ...
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Intermediate accounting
Authors: J. David Spiceland, James Sepe, Mark Nelson
7th edition
978-0077614041, 9780077446475, 77614046, 007744647X, 77647092, 978-0077647094
