At the beginning of the year, your company borrows $33,600 by signing a six-year promissory note that states an annual interest rate of 9% plus principal repayments of $5,600 each year. Interest is paid at the end of the second and fourth quarters, whereas principal payments are due at the end of each year. How does this new promissory note affect the current and non-current liability amounts reported on the classified balance sheet prepared at the end of the first quarter? 10 Multiple Choice Increase current llabilities by $6,356.00; increase non-current llablities by $33,600 Increase current liabilities by $3,024; increase non-current liabilities by $33,600 Increase current liabilities by $6,356.00; Increase non-current liabilities by $28,000 Increase current liabilities by $756.00, increase non-current labilities by $33,600
At the beginning of the year, your company borrows $33,600 by signing a six-year promissory note that states an annual interest rate of 9% plus principal repayments of $5,600 each year. Interest is paid at the end of the second and fourth quarters, whereas principal payments are due at the end of each year. How does this new promissory note affect the current and non-current liability amounts reported on the classified balance sheet prepared at the end of the first quarter? 10 Multiple Choice Increase current llabilities by $6,356.00; increase non-current llablities by $33,600 Increase current liabilities by $3,024; increase non-current liabilities by $33,600 Increase current liabilities by $6,356.00; Increase non-current liabilities by $28,000 Increase current liabilities by $756.00, increase non-current labilities by $33,600
Financial Accounting
14th Edition
ISBN:9781305088436
Author:Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:Carl Warren, Jim Reeve, Jonathan Duchac
Chapter14: Long-term Liabilities: Bonds And Notes
Section: Chapter Questions
Problem 11E
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