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Assume that on December 1, 2015, your company borrowed $45,000, a portion of which is to be repaid each year on November 30. Specifically, your company will make the following principal payments: 2016, $6,000; 2017, $9,000; 2018, $12,000; and 2019, $18,000. Show how this loan will be reported in the December 31, 2016 and 2015 balance sheets, assuming that principal payments will be made when required.

Respuesta :

Answer:

                                                                2016               2015

Current liabilities  

Current portion of long term debt $9,000               $6,000

Long term liabilities  

Long term debt                                 $30,000               $39,000

Total liabilities                                 $39,000               $45,000

Explanation:

According to the scenario, the computation of the given data are as follows:

As, in 2015 total amount borrowed = $45,000

Out of which $6,000 is due on Nov.30 2016

So, Remaining for 2016 is $45,000 - $6,000 = $39,000

Out of which $9,000 is due on Nov.30 2017

So, the balance sheet are as follows:

                                                                2016               2015

Current liabilities  

Current portion of long term debt $9,000               $6,000

Long term liabilities  

Long term debt                                 $30,000               $39,000

Total liabilities                                 $39,000               $45,000

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