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    Identify Whether Obligations are Current Liabilities

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    Please help with the following problem. Provide step by step calculations.

    Cardinal Co. has the following obligations at Dec. 31st: (a) a note payable for $100,000 due in 2 yrs., (b) a 10 yr mortgage payable of $300,000 payable in ten $30,000 annual payments, (c) interest payable of $15,000 on the mortgage, and (d) accounts payable of $60,000.

    For each obligation, indicate whether it should be classified as a current liability.
    (assume an operating cycle of less than one year).

    © BrainMass Inc. brainmass.com June 3, 2020, 7:47 pm ad1c9bdddf
    https://brainmass.com/business/accounting-for-liabilities/identify-whether-obligations-current-liabilities-111719

    Solution Preview

    Problem: Cardinal Co. has the following obligations at Dec. 31st: (a) a note payable for $100,000 due in 2 yrs., (b) a 10 yr mortgage payable of $300,000 payable in ten $30,000 annual payments, (c) interest payable of $15,000 on the mortgage, and (d) accounts payable of $60,000. For each obligation, ...

    Solution Summary

    The posting helps identify whether obligations are current liabilities. This solution explains how we can identify liabilities and current liabilities in 155 words backed up by calculations. Step by step calculations are given.

    $2.19

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