Reference no: EM133126447
Question - Amenadiel Co. has the following liabilities on December 31, 2020:
8% note payable P1,000,000
10% note payable 750,000
10% note payable 1,000,000
11% note payable 625,000
11% note payable 700,000
12% loan payable 500,000
13% loan payable 375,000
(a) The 8%, P1,000,000 note payable is due on March 31, 2021.
(b) The 10%, P750,000 note payable matures on June 30, 2021. Interest on this note is due every June 30 and December 31. On December 15, 2020, the company entered into a refinancing agreement with a bank to refinance the note on a long-term basis. The refinancing was completed on December 28, 2020.
(c) The 10%, P1,000,000 note payable matures on June 30, 2021. Interest on this note is due every June 30 and December 31. On December 20, 2020, the company entered into a refinancing agreement with a bank to refinance the note on a long-term basis. The refinancing was completed on January 5, 2021.
(d) The 11%, P625,000 five-year note was obtained by the company from a bank during 2020. The agreement requires the company to maintain a current ratio of 3:1. If the current ratio falls below 3:1, the note becomes payable on demand. As of December 31, 2020, the company's current ratio is 2:1. On December 31, 2020, the bank agreed to collect the note on March 1, 2022.
(e) The 11%, P700,000 five-year note was obtained by the company from a bank during 2020. The agreement requires the company to maintain a current ratio of 3:1. If the current ratio falls below 3:1, the note becomes payable on demand. As of December 31, 2020, the company's current ratio is 2:1. On December 31, 2020, the bank agreed not to demand payment within 6 months from the balance sheet date.
(f) The 12%, P500,000 loan is payable on demand.
(g) The 13%, P375,000 loan is maturing on July 1, 2021. Interest is due every July 1 and December 31. On January 15, 2021, the company entered into a refinancing agreement with a bank to refinance the loan on a long-term basis. Both parties are financially capable of honoring the agreement's provisions. The company has the discretion to refinance the loan for at least 12 months from December 31, 2020 under an existing loan facility.
The company's financial statements were authorized for issue on March 15, 2021.
1. How much of the above items to be included as current liabilities on December 31, 2020?
2. How much of the above items to be included as noncurrent liabilities on December 31, 2020?