On December 31, 2025, Sarasota Company has $7,070,000 of short-term debt in the form of notes payable to Gotham State Bank due in 2026. On December 28, 2025, Sarasota enters into a refinancing agreement with Gotham that will permit it to borrow up to 56% of the gross amount of its accounts receivable. Receivables are expected to range between a low of $6,080,000 in May to a high of $8,062.000 in October during the year 2026. The interest cost of the maturing short-term debt is 15%, and the new agreement calls for a fluctuating interest at 1% above the prime rate on notes due in 2030. Sarasota's December 31, 2025, balance sheet is issued on February 15, 2026. Prepare a partial balance sheet for Sarasota at December 31, 2025, showing how its $7,070,000 of short-term debt should be presented. (Enter account name only and do not provide descriptive information) SARASOTA COMPANY Partial Balance Sheet

On December 31, 2025, Sarasota Company has $7,070,000 of short-term debt in the form of notes payable to Gotham State Bank due in 2026. On December 28, 2025, Sarasota enters into a refinancing agreement with Gotham that will permit it to borrow up to 56% of the gross amount of its accounts receivable. Receivables are expected to range between a low of $6,080,000 in May to a high of $8,062.000 in October during the year 2026. The interest cost of the maturing short-term debt is 15%, and the new agreement calls for a fluctuating interest at 1% above the prime rate on notes due in 2030. Sarasota's December 31, 2025, balance sheet is issued on February 15, 2026. Prepare a partial balance sheet for Sarasota at December 31, 2025, showing how its $7,070,000 of short-term debt should be presented. (Enter account name only and do not provide descriptive information) SARASOTA COMPANY Partial Balance Sheet

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

On February 10, 2021, after issuance of its financial statements for 2020, Sunland Company entered into a financing agreement with Cleveland Bank, allowing Sunland Company to borrow up to $8060000 at any time through 2023. Amounts borrowed under the agreement bear interest at 3% above the bank's prime interest rate and mature two years from the date of loan. Sunland Company presently has $3100000 of notes payable with Star National Bank maturing March 15, 2021. The company intends to borrow $4910000 under the agreement with Cleveland and liquidate the notes payable to Star National Bank. The agreement with Cleveland also requires Sunland to maintain a working capital level of $12050000 and prohibits the payment of dividends on common stock without prior approval by Cleveland Bank. From the above information only, the total short-term debt of Sunland Company as of the December 31, 2020 balance sheet date is $8060000. $0. $3990000. $3100000.
White Hot Chocolate Company had a 12% note receivable dated June 30, 2020 in the original amount of P3,000,000. Payments of P1,000,000 in principal plus accrued interest are due annually on July 1, 2021, 2022 and 2023. In its June 30, 2021 balance sheet, what amount should White Hot Chocolate report as accrued interest on notes receivable?
ML Company purchased merchandise for resale on January 1, 2021, for P5,000 cash plus a P20,000, two-year note payable. The principal is due on December 31, 2022; the note specified 8% interest payable each December 31. ML's going rate of interest for this type of debt was 15%. How much is the carrying amount of the note payable on December 31, 2021 (round off to four decimal places)? A.P20,000B.P19,142C.P17,724D.P18,783
On April 1, 2021, the Electronic Superstore borrows $21 million of which $7 million is due in 2022. Show how the company would report the $21 million debt on its December 31, 2021 balance sheet. (Enter your answers in dollars not in millions. For example, $7,000,000 rather than $7 million.) Electronic Superstore Partial Balance sheet December 31st 2021 Current liabilities: Long-term liabilities: Total liabilities
Waterway Company has the following two notes receivable at May 31, 2024, its fiscal year end: 1. 2. $32,400 six-month, 6% note issued January 1, 2024. $12,000 three-month, 4% note issued April 30, 2024. Interest is payable at maturity for both notes. (a) Calculate the accrued interest on both notes at May 31, 2024. (Round answers to the nearest whole dollar, e.g. 5,275.) Note 1: Note 2: Total accrued interest $
Groudon Bank loaned P12,000,000 to Kyogre Company on January 1, 2020, the terms of the loan require principal payments of P2,000,000 each year for 6 years plus interest at 6%. The first principal and interest payment is due on December 31, 2020. Kyogre made the required payments on December 31, 2020, and December 31, 2021. However, Kyogre began to experience financial difficulties during 2022 which requires the bank to reassess the collectibility of the loan. On December 31, 2022, the bank determined that the remaining principal payments will be collected but the collection of the interest is unlikely. The bank did not accrue the interest for 2022. Expected Principal Payments December 31, 2024 P4,000,000 December 31, 2025 2,500,000 December 31, 2026 1,500,000 Note: Round off present value factors up to four decimal points; round off the final value up to two decimal points. E.g., 0.7812 and 123,518.25 Questions: How much is the impairment loss to be recorded on December…
For items 15 to 17 BDO Bank loaned P7,500,000 to a borrower on January 1, 2023. The terms of the loan were payment in full on December 31, 2027 plus annual interest payment at 12% beginning December 31, 2023. The interest payment was made as scheduled on December 31, 2023. However, due to financial setbacks, the borrower was unable to make the December 31, 2024 interest payment. The bank considered the loan impaired and projected the cash flows from the loan on December 31, 2024. The bank had accrued the interest on December 31, 2024. Date of cash flow December 31, 2025 December 31, 2026 December 31, 2027 December 31, 2028 Amount projected December 31, 2023 Present value of 1 at 12% P500,000 One period .89 1,000,000 Two periods .80 2,000,000 Three periods.71 4,000,000 Four periods .64 What amount should be recognized as impairment loss for 2024?
The following balances were reported by Nagpapangap Company on December 31, 2020 and 2019: 2020: Accounts payable - P3,500,000; Notes payable - P4,000,000 2019: Accounts payable - P2,500,000; Notes payable - P1,500,000 On July 1, 2020, the company issued a one-year, 12% note for a bank loan of P1,000,000. All other notes payable arose from purchases of merchandise. Total payment to suppliers in 2020 amounted to P11,000,000, after purchase discount of P250,000. During 2020, company returned defective merchandise costing P500,000. What is the amount of gross purchases for 2020 under the accrual basis? *
On December 1, 2020, ABC Company assigned specific accounts receivable totaling P5,000,000 as collateral on a P4,000,000, 12% note from certain bank. The entity will continue to collect the assigned accounts receivable. In addition to the interest on the note, the bank also charged a 5% finance fee deducted in advance on the assigned accounts. The December collections of assigned accounts receivable amounted to P2,000,000 less cash discount of P200,000. On December 31, 2020, the entity remitted the collections to the bank in payment for the interest accrued on December 31, 2020 and the note payable. The entity accepted sales returns of P100,000 on the assigned accounts and wrote off assigned accounts of P300,000. Compute the carrying amount of the note payable on December 31, 2020.
On December 1, 2020, Max Company assigned specific accounts receivable totaling P5,000,000 as collateral on a P4,000,000, 12% note from DBP bank. The entity will continue to collect the assigned accounts receivable. In addition to the interest of the note, the bank also charged a 5% finance fee deducted in advance of the assigned accounts. The December collection of assigned accounts receivable amounted to P2,000,000 less cash discount of P200,000. On December 31, 2020, the Company remitted the collections on the bank in payment for the interest earned on December 31, 2020 and the note payable. The entity accepted sales returns of 100,000 on the assigned notes and wrote off assigned accounts of 30,000. What is the carrying amount of note payable on December 31, 2020?
The following selected transactions relate to liabilities of United Insulation Corporation. United's fiscal year ends on December 31. 2024 January 13 Negotiated a revolving credit agreement with Parish Bank that can be renewed annually upon bank approval. The amount available under the line of credit is $27.0 million at the bank's prime rate. February 1 Arranged a three-month bank loan of $6.6 million with Parish Bank under the line of credit agreement. Interest at the prime rate of 13% was payable at maturity. May 1 Paid the 13% note at maturity. December 1 Supported by the credit line, issued $16.3 million of commercial paper on a nine - month note. Interest was discounted at Issuance at a 12% discount rate. December 31 Recorded any necessary adjusting entry(s). 2025 September 1 Paid the commercial paper at maturity. Required: Prepare the appropriate journal entries through the maturity of each liability.
THREE FLAGS Co. borrowed $100,000 from the Bull Run Bank on September 1, 2018. The note earns interest at a rate of 12% and matures in six months on February 28, 2019. THREE FLAGS is supposed to pay off BOTH principal and interests on February 28, 2019. Both THREE FLAGS Co. and Bull Run Bank prepares their financial statements on December 31. Please provide Journal entries for THREE FLAGS Co. on the following dates: 9/1/2018 12/31/2018 2/28/2019 Please provide Journal entries for Bull Run Bank on the following dates: 9/1/2018 12/31/2018 2/28/2019