12. On December 31, 2011, L, Inc., had a $1,500,000 note payable outstanding, due July 31, 2012. 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 $500,000 of the note on January 23, 2012. In February 2012, L completed a $3,000,000 bond offering. L will use the bond offering proceeds to repay the note payable at its maturity and to pay construction costs during 2012. On March 13, 2012, L issued its 2011 financial statements. What amount of the note payable should L include in the current liabilities section of its December 31, 2011, balance sheet? A. SO B. $500,000 C. $1,000,000 D. $1,500,000
12. On December 31, 2011, L, Inc., had a $1,500,000 note payable outstanding, due July 31, 2012. 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 $500,000 of the note on January 23, 2012. In February 2012, L completed a $3,000,000 bond offering. L will use the bond offering proceeds to repay the note payable at its maturity and to pay construction costs during 2012. On March 13, 2012, L issued its 2011 financial statements. What amount of the note payable should L include in the current liabilities section of its December 31, 2011, balance sheet? A. SO B. $500,000 C. $1,000,000 D. $1,500,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Give answer in this formate
Option a: This option is correct or incorrect because
Option b: This option is correct or incorrect because
Option c: This option is correct or incorrect because
Option d: This option is correct or incorrect because
Option e: This option is correct or incorrect because
Transcribed Image Text:12. On December 31, 2011, L, Inc., had a $1,500,000 note payable outstanding, due July 31, 2012. 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 $500,000 of the note on January 23,
2012. In February 2012, L completed a $3,000,000 bond offering. L will use the bond offering proceeds to
repay the note payable at its maturity and to pay construction costs during 2012. On March 13, 2012, L
issued its 2011 financial statements. What amount of the note payable should L include in the current
liabilities section of its December 31, 2011, balance sheet?
A. SO
B. $500,000
C. $1,000,000
D. $1,500,000
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