Intermediate Accounting
1st Edition
ISBN: 9780132162302
Author: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella
Publisher: PEARSON
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Chapter 14, Problem 14.33BE
Short-Term Debt Expected to Be Refinanced, IFRS. Using the information provided m BE14-30, prepare the
BE14-30. Short-Term Debt Expected to Be Refinanced, U.S. GAAP. Saxon Woods, Inc. has a fiscal year-end of December 31, 2017. The company reported $124,500 in short-term notes payable due on April 1, 2018. on its year-end
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The Company issued a short-term debt of $65,000 on July 1, 2021 for a period of 5 months with a note payable of 14% interest. The company uses the accounting period on a quarterly basis.
Required: Prepare the journal entries needed to record the issuance of the debt, recognize interest expense, matures. and pay off the debt as it
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KMC Inc. provided a loan to Jim Ltd on January 1st, 2016 and received in exchange a 4-year, $120,000 note bearing interest at 8% to be paid annually on December 31. The market rate of interest for financial instruments of similar risk is 2%.
KMC Inc. financial year ends December 31 and the company uses the effective interest method to amortize discount and recognize interest revenue.
Required: Round to nearest whole number
d) Prepare the journal entry in KMC’s books to record the issuance of the note on January 1, 2016.
e) Prepare KMC’s 4-year Note Amortization schedule.
f) Prepare the journal entry KMC records on December 31, 2017.
(Refinancing of Short-Term Debt) On December 31, 2017, Kate Holmes Company has $7,000,000 of short-term debt in the form of notes payable to Gotham State Bank due in 2018. On January 28, 2018, Holmes enters into a refinancing agreement with Gotham that will permit it to borrow up to 60% of the gross amount of its accounts receivable. Receivables areexpected to range between a low of $6,000,000 in May to a high of $8,000,000 in October during the year 2018. 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 2022. Holmes’s December 31, 2017, balance sheet is issued on February 15, 2018.InstructionsPrepare a partial balance sheet for Holmes at December 31, 2017, showing how its $7,000,000 of short-term debt should be presented, including footnote disclosure.
Chapter 14 Solutions
Intermediate Accounting
Ch. 14 - What conditions or terms does a note payable...Ch. 14 - If the market rate of interest exceeds the face or...Ch. 14 - What is included in bond issue costs and how...Ch. 14 - Prob. 14.4QCh. 14 - When a bond is issued at a discount, will its...Ch. 14 - Prob. 14.6QCh. 14 - Prob. 14.7QCh. 14 - Under IFRS, how do firms account for convertible...Ch. 14 - Prob. 14.9QCh. 14 - Can companies reclassify short-term debt expected...
Ch. 14 - Under IFRS, can companies reclassify short-term...Ch. 14 - Do companies always reclassify long-term debt that...Ch. 14 - Prob. 14.13QCh. 14 - Prob. 14.14QCh. 14 - Prob. 14.15QCh. 14 - Prob. 14.16QCh. 14 - Prob. 14.1MCCh. 14 - Prob. 14.2MCCh. 14 - Prob. 14.3MCCh. 14 - Prob. 14.4MCCh. 14 - Prob. 14.5MCCh. 14 - Clothes Horse Corp. (CHC) Issued 500,000 bonds due...Ch. 14 - Prob. 14.7MCCh. 14 - Prob. 14.8MCCh. 14 - Prob. 14.9MCCh. 14 - Prob. 14.10MCCh. 14 - Prob. 14.11MCCh. 14 - Prob. 14.1BECh. 14 - Notes Payable. Using the information provided in...Ch. 14 - Prob. 14.3BECh. 14 - Prob. 14.4BECh. 14 - Prob. 14.5BECh. 14 - Prob. 14.6BECh. 14 - Prob. 14.7BECh. 14 - Bond Pricing. Fill in the missing items for each...Ch. 14 - Prob. 14.9BECh. 14 - Bond Issue Price. Using the information from...Ch. 14 - Prob. 14.11BECh. 14 - Prob. 14.12BECh. 14 - Prob. 14.13BECh. 14 - Prob. 14.14BECh. 14 - Prob. 14.15BECh. 14 - Prob. 14.16BECh. 14 - Prob. 14.17BECh. 14 - Prob. 14.18BECh. 14 - Prob. 14.19BECh. 14 - Prob. 14.20BECh. 14 - Bonds Issued between Interest Payment Dates. For...Ch. 14 - Prob. 14.22BECh. 14 - Prob. 14.23BECh. 14 - Prob. 14.24BECh. 14 - Prob. 14.25BECh. 14 - Prob. 14.26BECh. 14 - Prob. 14.27BECh. 14 - Prob. 14.28BECh. 14 - Prob. 14.29BECh. 14 - Prob. 14.30BECh. 14 - Prob. 14.31BECh. 14 - Prob. 14.32BECh. 14 - Short-Term Debt Expected to Be Refinanced, IFRS....Ch. 14 - Prob. 14.34BECh. 14 - Prob. 14.35BECh. 14 - Prob. 14.36BECh. 14 - Prob. 14.37BECh. 14 - Prob. 14.38BECh. 14 - Prob. 14.39BECh. 14 - Prob. 14.1ECh. 14 - Prob. 14.2ECh. 14 - Prob. 14.3ECh. 14 - Prob. 14.4ECh. 14 - Prob. 14.5ECh. 14 - Prob. 14.6ECh. 14 - Prob. 14.7ECh. 14 - Prob. 14.8ECh. 14 - Prob. 14.9ECh. 14 - Prob. 14.10ECh. 14 - Prob. 14.11ECh. 14 - Prob. 14.12ECh. 14 - Prob. 14.13ECh. 14 - Prob. 14.14ECh. 14 - Prob. 14.15ECh. 14 - Prob. 14.16ECh. 14 - Prob. 14.17ECh. 14 - Prob. 14.18ECh. 14 - Prob. 14.19ECh. 14 - Prob. 14.20ECh. 14 - Prob. 14.21ECh. 14 - Prob. 14.1PCh. 14 - Prob. 14.2PCh. 14 - Prob. 14.3PCh. 14 - Prob. 14.4PCh. 14 - Prob. 14.5PCh. 14 - Prob. 14.6PCh. 14 - Prob. 14.7PCh. 14 - Prob. 14.8PCh. 14 - Prob. 14.9PCh. 14 - Prob. 14.10PCh. 14 - Prob. 1JCCh. 14 - Prob. 2JCCh. 14 - Prob. 3JCCh. 14 - Prob. 1FSACCh. 14 - Prob. 1SSCCh. 14 - Surfing the Standards Case 2: Bonds with...Ch. 14 - Prob. 1BCC
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- Taken from the records of Care Company as of December 31, 2021 are the following information: Long-term debt of P10,000,000 dated January 1, 2014 due December 31, 2022. Albano expects to refinance this liability on a long-term basis on January 2022. The financing agreement was consummated on February 2, 2022. Note payable due on January 1, 2024 amounting to P6,000,000. The note is payable on demand. Bank loan of P14,000,000 due December 31, 2026 wherein a breach of loan covenant was committed by Albano during 2021. The bank agreed on December 31, 2021 to provide Sayonara a grace period to rectify the breach ending December 31, 2022. Serial bonds dated January 8, 2021 totalling P10,000,000 payable in 10 annual instalments. 5. How much would be included in the current liabilities section of Care’s year-end financial statement?arrow_forward1) Remaining VAT accounts of our company as of the end of January 2021 are as follows. 191 Deductible VAT = 10.000 TL Debt Remaining 391 Calculated VAT = 8.000 TL Credit Remainder Record the journal (daily book) regarding VAT offset.arrow_forward"On 1 September 2014, Select Company borrowed P600,000 from a bank and signed a 12%, six-month note payable, with interest on the note due at maturity. The total amount of the current liability (including interest payable) for this loan that appears in Select Company's statement of financial position at 31 December 2014 is: " O A. P600,000. O B, P636,000. OC P672,000. O D. P624,000.arrow_forward
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