Reference no: EM132628048
Question - Using the problem below, prepare the liability section (showing current & noncurrent liabilities) of the Statement of Financial Position of Narra Corporation as of December 31, 2020
The December 31 trial balance of the Narra Corporation includes, among others, the following:
Cash in bank, net of bank overdraft of P50,000 P1,370,000
Accounts receivable, net of credit balance of P150,000 4,340,000
Goods in transit as of December 31, 2020, purchased
FOB shipping point, received January 5, 2021, not yet recorded as purchases 350,000
Land (acquired on July 1, 2020 with mortgage payable of P1,000,000 with annual interest of 10%; both principal and interest payable on June 30, 2022) 3,000,000
Accounts payable, net of debit balance of P100,000) 2,890,000
Salaries payable (including bonus to employees of P280,000) 640,000
Unearned service revenue (3/4 will be earned in 2021 while the balance will be earned in 2022) 600,000
Income tax payable 450,000
Estimated liability for warranty 325,000
Deferred tax liability 250,000
Notes Payable, which are payable in annual installment of P1,000,000 every December 31 3,000,000
Loans payable to bank, due March 30, 2021 2,000,000
Notes payable, obtained from bank on June 1, 2018, due on June 1, 2021 1,500,000
On January 15, 2021, Narra Corporation entered into a refinancing agreement with the bank for the notes payable to P1,500,00 that will due on June 1, 2021. The new maturity date is June 1, 2022.