Chapter 9, Problem 9.64SC

1.

To determine

If the Company C have recorded the loan agreement in its general ledger and the impact of this new loan agreement in the balance sheet of Company C during the year 2016 with explanation.

2.

To determine

To prepare: The entry to record the borrowing of Company F on July 1, 2018. And to find out the impact on its assets, liabilities and equity on that date.

3.

To determine

The interest expense accrued by Company F during the end of fiscal year 2018 and the impact of adjusting entry in the assets, liabilities and equity of Company F.

4.

To determine

The total interest expense related to the hypothetical borrowing for 2018.

5.

To determine

If the hypothetical borrowing in 2018 causes the Net Adjusted Leverage Ratio to increase. Decrease or stay the same with explanation.

6.

To determine

If the hypothetical borrowing in 2018 causes the EBITDAR Ratio to increase. Decrease or stay the same.