FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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The accountant for Jaemin Corporation prepared the following schedule of liabilities as of December 31,
2022.
Accounts payable and accrued expenses 1,650,000
Notes payable — trade 1,200,000
Notes Payable — bank 8,000,000
Wages and salaries payable 350,000
Interest payable ?
10% mortgage note payable 6,000,000
12% mortgage note payable 4,500,000
Bonds payable 10,000,000
The following additional information pertains to these liabilities:
a. The bank notes payable include two separate notes payable to Minhyung Bank:
(1) A P2,000,000, 8% note issued March 1, 2022, payable on demand. Interest is payable each
six months. Jaemin already made the first semi-annual interest payment on August 31, 2022.
(2) A 2-year, P6,000,000, 11 % note issued January 2, 2021. On December 30, 2022, after
paying the accrued interest, Jaemin negotiated a written agreement with the Minhyung Bank
to replace this note with a 2-year, P6,000,000, 10% note. The new note was issued January
2, 2023.
b. The 10% mortgage note was issued November 1, 2017, with a term of 10 years. The terms of the
note give the holder the right to demand immediate payment if the company fails to make a
quarterly interest payment within 10 days of the date the payment is due. As of December 31,
2022, is two months behind in paying its required interest payment. Penalty for non-payment of
interest charged by the bank was P120,000.
c. The 12% mortgage note was issued May 1, 2013, with a term of 20 years. Interest is due annually
on April 30.
d. d. The bonds payable are 10-year, 8% bonds, issued June 30, 2013. Interest is payable annually
every June 30.
REQUIRED:
(a) Compute the interest payable at June 30, 2022.
(b) Prepare the liabilities section of the December 31, 2022 classified statement of financial position for
Jaemin Corporation, include notes as appropriate
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