P13-2 - 2 / 12 ) ........... 200,000 Interest payable (from...

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Problem 13-2 Requirement 1 2009 a. No entry is made for a line of credit until a loan actually is made. It would be described in a disclosure note. b. Cash . ................................................................. 12,000,000 Notes payable . .............................................. 12,000,000 c. Cash . .................................................................. 2,600 Liability – refundable deposits . .................... 2,600 d. Accounts receivable (total) . ................................. 4,346,000 Sales revenue (given) . ..................................... 4,100,000 Sales taxes payable ([3% + 3%] x $4,100,000) . .. 246,000 e. Interest expense ($12,000,000 x 10% x 3 / 12 ) ........... 300,000 Interest payable . ........................................... 300,000 2010 f. Cash . ................................................................. 10,000,000 Bonds payable. .............................................. 10,000,000 Interest expense ($12,000,000 x 10% x
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Unformatted text preview: 2 / 12 ) ........... 200,000 Interest payable (from adjusting entry) . .................. 300,000 Notes payable (face amount) . ................................ 12,000,000 Cash ($12,000,000 + 500,000) . ........................... 12,500,000 g. Liability refundable deposits . ......................... 1,300 Cash . ............................................................. 1,300 Problem 13-2 (concluded) Requirement 2 C URRENT L IABILITIES : Accounts payable $ 252,000 Current portion of bank loan 2,000,000* Liability refundable deposits 2,600 Sales taxes payable 246,000 Accrued interest payable 300,000 Total current liabilities $2,800,600 L ONG-TERM L IABILITIES : Bank loan to be refinanced on a long-term basis $10,000,000* * The intent of management is to refinance all $12,000,000 of the bank loan, but the actual refinancing demonstrates the ability only for $10,000,000....
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P13-2 - 2 / 12 ) ........... 200,000 Interest payable (from...

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