How much of the Notes payable, net of discount, should be reported as part of current liabilities on December 31, 2015 statement of financial position?
How much of the Notes payable, net of discount, should be reported as part of current liabilities on December 31, 2015 statement of financial position?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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2. On January 1. 2015, Saved by Grace Corporation issued a three-year, non- interest bearing note with face value of P3,000,000 for a piece of land purchased from Not by Works Corporation. The note is payable in annual installments of P1,000,000 every December 31, starting on December 31, 2015. The land has an equivalent cash price of P2,400,000, a price that provides the note effective interest rate of 12%.
How much of the Notes payable, net of discount, should be reported as part of current liabilities on December 31, 2015 statement of financial position ? _____
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