ABC Company has a P15,000,000, two-year note payable to DEF that matures October 31, 2021. ABC's management intends to refinance the note for an additional three years and is negotiating a financing agreement with DEF. In order to exclude this note from current liabilities on its December 31, 2020, balance sheet, ABC Company must a.pay off the note and complete the refinancing before the 2020 financial statements are issued b.demonstrates an ability to refinance before the 2019 financial statements are issued c.complete the refinancing agreement before December 31,2020.
ABC Company has a P15,000,000, two-year note payable to DEF that matures October 31, 2021. ABC's management intends to refinance the note for an additional three years and is negotiating a financing agreement with DEF. In order to exclude this note from current liabilities on its December 31, 2020, balance sheet, ABC Company must a.pay off the note and complete the refinancing before the 2020 financial statements are issued b.demonstrates an ability to refinance before the 2019 financial statements are issued c.complete the refinancing agreement before December 31,2020.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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ABC Company has a P15,000,000, two-year note payable to DEF that matures October 31, 2021. ABC's management intends to refinance the note for an additional three years and is negotiating a financing agreement with DEF. In order to exclude this note from current liabilities on its December 31, 2020, balance sheet , ABC Company must
a.pay off the note and complete the refinancing before the 2020 financial statements are issued
b.demonstrates an ability to refinance before the 2019 financial statements are issued
c.complete the refinancing agreement before December 31,2020.
d.complete the refinancing agreement before October 31,2021.
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