Sombrero Inc. provided the following information on December 31, 2021: Accounts payable... Bank note payable-10%. Bank note payable-11%. Mortgage note payable-10%. Bonds payable. • The P 3,000,000, 10% note was issued March 1, 2021 payable on demand. Interest is payable every 6 months. The one-year P 5,000,000, 11% note was issued on January 15, 2021. On December 31, 2021, the entity negotiated a written agreement with the bank to replace the note with a 2-year P 5,000,000, 10% note to be issued on January 15, 2022. • The 10% mortgage note was issued on October 1, 2018 with a term of 10 years. Term of the note give the holder the right to demand immediate payment if the entity fails to make a monthly interest payment within 10 days from the date the payment is due. On December 31, 2021 the entity is three months behind in making the required interest .P 6,500,000 3,000,000 5,000,000 2,000,000 4,000,000 payment. • Thhe bonds payable are 10-year 8% bonds, issued on June 30, 2012. Interest is payable semi-annually on Iune 30 and December 31

Sombrero Inc. provided the following information on December 31, 2021: Accounts payable... Bank note payable-10%. Bank note payable-11%. Mortgage note payable-10%. Bonds payable. • The P 3,000,000, 10% note was issued March 1, 2021 payable on demand. Interest is payable every 6 months. The one-year P 5,000,000, 11% note was issued on January 15, 2021. On December 31, 2021, the entity negotiated a written agreement with the bank to replace the note with a 2-year P 5,000,000, 10% note to be issued on January 15, 2022. • The 10% mortgage note was issued on October 1, 2018 with a term of 10 years. Term of the note give the holder the right to demand immediate payment if the entity fails to make a monthly interest payment within 10 days from the date the payment is due. On December 31, 2021 the entity is three months behind in making the required interest .P 6,500,000 3,000,000 5,000,000 2,000,000 4,000,000 payment. • Thhe bonds payable are 10-year 8% bonds, issued on June 30, 2012. Interest is payable semi-annually on Iune 30 and December 31

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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