On April 1, 2020, Hudson Enterprisesissued a 4% long-term note payable for$18,000. It is payable over a 3-year termin $6,000 principal installments on April1 of each year, beginning April 1, 2021.Each yearly installment will includeboth principal repayment of $6,000 andinterest payment for the precedingone-year period.What is the total cash payment Hudsonwill make on April 1, 2021?

Step 1: Definition of Total Cash Payment on InstallmentA total cash payment on an installment refers…

Answered: On April 1, 2020, Hudson Enterprises…

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 1PA: On January 1, 2018, King Inc. borrowed $150,000 and signed a 5-year, note payable with a 10%...

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Similar questions

Chemical Enterprises issues a note in the amount of $156,000 to a customer on January 1, 2018. Terms of the note show a maturity date of 36 months, and an annual interest rate of 8%. What is the accumulated interest entry if 9 months have passed since note establishment?
If Bergen Air Systems takes out a $100,000 loan, with eight equal principal payments due over the next eight years, how much will be accounted for as a current portion of a noncurrent note payable each year?
Halep Inc. borrowed $30,000 from Davis Bank and signed a 4-year note payable stating the interest rate was 4% compounded annually. Halep Inc. will make payments of $8,264.70 at the end of each year. Prepare an amortization table showing the principal and interest in each payment.
Lime Co. incurs a $4,000 note with equal principal installment payments due for the next eight years. What is the amount of the current portion of the noncurrent note payable due in the second year? A. $800 B. $1,000 C. $500 D. nothing, since this is a noncurrent note payable
Short-Term Debt Expected to Be Refinanced On December 31, 2019, Atwood Table Company has 8 million of short-term notes payable owed to City National Bank. On February 1, 2020, Atwood negotiates a revolving credit agreement providing for unrestricted borrowings up to 6 million. Borrowings will bear interest at 1% over the prevailing prime rate, will have stated maturities of 120 days, and will be continuously renewable for 120-day periods for 4 years. Atwood plans to refinance as much as possible of the notes outstanding with the proceeds available from this agreement. Assume that Atwoods December 31, 2019, year-end financial statements are issued on March 30, 2020. Required: Prepare a partial December 31, 2019, balance sheet for Atwood showing how the 8 million short-term debt should be reported. Next Level What is the justification for allowing short-term debt that is expected to be refinanced to be classified as a long-term liability.
Jones Company signed a 5-year note payable on January 1, 2020, of $100,000. The note requires annual principal payments each December 31 of $20,000 plus interest of 5%. The entry to record the annual payment on December 31, 2021, includes:
On March 1, 2024, Lewis Services issued a 10% long - term notes payable for $24,000. It is payable over a 6– year term in $4000 principal installments on March 1 of each year, beginning March 1, 2025. Which of the following entries needs to be made on March 1, 2024? O A. Current Portion of Long - Term Notes Payable Long- Term Notes Payable 24,000 24,000 O B. Long - Term Notes Payable Accounts Payable 24,000 24,000 O C. Long - Term Notes Payable 4000 Cash 4000 O D. Cash 24,000 Long - Term Notes Payable 24,000
On January 1, 2018, the Merit Group issued to its bank a $41 million, five-year installment note to be paid infive equal payments at the end of each year. Installment payments of $10 million annually include interest atthe rate of 7%. What would be the amount(s) related to the note that Merit would report in its statement of cashflows for the year ended December 31, 2018?
On January 1, 2020, MWB, Inc. borrowed cash by issuing a $600,000, 6-year note that specified 6% interest to be paid on December 31 of each year and the $600,000 to be paid at maturity. If the note had instead been an installment note to be paid in six equal payments at the end of each year beginning December 31, 2020, which of the following would be true? Select one: a. The annual cash payment would have been less b. The first year's interest expense would have been higher c. The effective interest rate would have been higher. d. The second year's interest expense would have been less than in year one e. The second year's interest expense would have been less than in year three Clear my choice
Sammy Company, a calendar-year company, has a 6% note receivable dated November 1, 2020 in the original amount of P3,000,000. Payments of P1,000,000 in principal plus interest on the outstanding balance are due annually on October 31, 2021, 2022 and 2023. How much is the interest revenue from the note for the year ended December 31, 2021?
On January 1, 2021, Cullumber Corp. borrows $9,000 by signing a 3-year, 3% note payable. The note is repayable in three annual fixed principal payments on December 31 of each year. Calculate the annual principal payment. Annual principal payment $enter the Annual principal payment in dollars Prepare an instalment payment schedule for the note. Period Cash payment Interest Expense Reduction of Principal Principal Balance Jan. 1, 2021 $enter a dollar amount $enter a dollar amount $enter a dollar amount $enter a dollar amount Dec. 31, 2021 enter a dollar amount enter a dollar amount enter a dollar amount enter a dollar amount Dec. 31, 2022 enter a dollar amount enter a dollar amount enter a dollar amount enter a dollar amount Dec. 31, 2023 enter a dollar amount enter a dollar amount enter a dollar amount enter a dollar amount Prepare journal entries to record the note and the first instalment…
On July 1, 2021, ABC Co. borrowed P1,000,000 and issued a one-year note payable. The lenderdiscounted the note at 12%.Prepare all the necessary journal entries under the following scenarios:a. The note is due on lump sum on June 30, 2022. The effect of discounting is immaterial.b. The note is due in equal quarterly installments starting September 20, 2021

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