Chapter 6, Problem 6.1E

Classification of Assets and Liabilities. Darin Development Company engaged in the following transactions during the current year.

1. a. Borrowed $400,000 from Pleasantville Community Bank at the beginning of the year. The terms of the end call for annual payments of $50,000. The first annual payment has not been paid as of the end of the current year. (Ignore any interest payable.)
2. b. Made sales for the current year amounting to $2,900,000 with 40% collected during the current year.
3. c. Acquired inventory costing $345,000 on account.
4. d. incurred taxes due on the current year's income of $76,000.
5. e. Paid $60,000 for a three-year insurance policy in advance on January 1 of the current year.
6. f. Acquired new equipment costing $890,000 by borrowing the full amount at the end of the current year The loan is due in 5 years.

Required

Identify and classify the noncash assets and liabilities resulting from the current-year transactions Assume that your classification is made as of the end of the current year