Business, 10.04.2020 17:55 bloom826

Talkington Electronics issues a R$400,000, 8%, 10-year mortgage note on Decem- ber 31, 2016. The proceeds from the note are to be used in financing a new research laboratory. The terms of the note provide for annual installment payments, exclusive of real estate taxes and insurance, of R$59,612. Payments are due on December 31.

a) Show how the total mortgage liability should be reported on the statement of financial position at December 31, 2017.

b) Assume that Talkington Electronics prepares annual adjusting entries on March 31 each year.

1) Prepare the required adjusting entry on March 31, 2017.

2) Prepare the entry for the first installment payment on December 31, 2017.

3) Under these revised facts, would your answer to (c) in the text change? Why or why not?

4) What is the total amount of interest expense that will be recognized over the life of the mortgage? Given that it is probable that the interest will be paid, explain why the total amount of interest is not recognized as a liability on the March 31, 2017, balance sheet.

Answers: 2

Show answers

Another question on Business

Business, 22.06.2019 11:30

Which of the following is not an example of one of the four mail advantages of prices on a free market economy

Answers: 1

Answer

Business, 22.06.2019 20:40

Aggart technologies is considering issuing new common stock and using the proceeds to reduce its outstanding debt. the stock issue would have no effect on total assets, the interest rate taggart pays, ebit, or the tax rate. which of the following is likely to occur if the company goes ahead with the stock issue? a. the roa will decline.b. taxable income will decline.c. the tax bill will increase.d. net income will decrease.e. the times-interest-earned ratio will decrease

Answers: 1

Answer

Business, 22.06.2019 20:50

Lead time for one of your fastest-moving products is 20 days. demand during this period averages 90 units per day.a) what would be an appropriate reorder point? ) how does your answer change if demand during lead time doubles? ) how does your answer change if demand during lead time drops in half?

Answers: 1

Answer

Business, 22.06.2019 21:40

Rebel technology maintains its records using cash-basis accounting. during the year, the company received cash from customers, $43,000, and paid cash for salaries, $23,500. at the beginning of the year, customers owe rebel $1,000. by the end of the year, customers owe $6,600. at the beginning of the year, rebel owes salaries of $5,600. at the end of the year, rebel owes salaries of $3,300. determine cash-basis net income and accrual-basis net income for the year.

Answers: 2

Answer

You know the right answer?

Talkington Electronics issues a R$400,000, 8%, 10-year mortgage note on Decem- ber 31, 2016. The pro...

Questions