Reference no: EM13994786
The balance sheet at December 31, 2011, for Nevada Harvester Corporation includes the liabilities listed below:
a. 11% bonds with a face amount of $40 million were issued for $40 million on October 31, 2000. The bonds mature on October 31, 2022. Bondholders have the option of calling (demanding payment on) the bonds on October 31, 2012, at a redemption price of $40 million. Market conditions are such that the call is not expected to be exercised.
b. Management intended to refinance $6 million of its 10% notes that mature in May 2012. In early March, prior to the actual issuance of the 2011 financial statements, Nevada Harvester negotiated a line of credit with a commercial bank for up to $5 million any time during 2012. Any borrowings will mature two years from the date of borrowing.
c. Non callable 12% bonds with a face amount of $20 million were issued for $20 million on September 30, 1988. The bonds mature on September 30, 2012. Sufficient cash is expected to be available to retire the bonds at maturity.
d. A $12 million 9% bank loan is payable on October 31, 2017. The bank has the right to demand payment after any fiscal year-end in which Nevada Harvester's ratio of current assets to current liabilities falls below a contractual minimum of 1.7 to 1 and remains so for six months. That ratio was 1.45 on December 31, 2011, due primarily to an intentional temporary decline in inventory levels. Normal inventory levels will be reestablished during the first quarter of 2012.
Required:
1. Determine the amount that can be excluded from classification as a current liability (that is, reported as a noncurrent liability) for each. Explain the reasoning behind your classifications.
2. Prepare the liability section of a classified balance sheet and any necessary footnote disclosure for Nevada Harvester at December 31, 2011. Accounts payable and accruals are $22 million.
|
Software engineer working as a performance engineer
: Prepare and submit a paper dealing with a topic from your current course that could be applied to your workplace. The paper should be a minimum of 750 words (about 3 double-spaced pages) and contain a minimum of two (2) outside references from peer-r..
|
|
What kind of claims are the economists making
: Some economists think the government should help fund local sports stadiums while other economists think the government should leave the funding up to the private sector. a. What kind of claims are the economists making? b. What are two reasons the e..
|
|
Using a supply-and-demand graph
: Using a supply-and-demand graph and assuming competitive markets, show and explain the effect on equilibrium price and quantity of the following: A technological change that reduces the cost of producing X-Rays on the market for physician clinic serv..
|
|
Write a function that accepts an array of integer
: Write a function that accepts an array of integer values and the number of values in this array. It should return true if any of the values in the array is the square of one of the other values, and false otherwise
|
|
Prepare the liability section of a classified balance sheet
: Prepare the liability section of a classified balance sheet and any necessary footnote disclosure for Nevada Harvester at December 31, 2011. Accounts payable and accruals are $22 million.
|
|
Assume that you are approaching the implementation
: Assume that you are approaching the implementation and deployment phases of the online course management system that you worked on in previous assignments. Imagine that the client signed a long term contract that entitles the client to software and s..
|
|
Production possibilities curve between health and all goods
: Draw a production possibilities curve between health and all other goods. Insert a point in the drawing that illustrates an economy with an inefficient health system. Insert two additional points that illustrate two efficient economies, but two that ..
|
|
Federal funds rate is higher than the target rate
: What might the Fed do if the federal funds rate is higher than the target rate? How would it use its tools (required reserve ratio, discount rate, and open market operations) to achieve this target?
|
|
Look up and research an instance
: Look up and research an instance where a business has encountered an event (disaster, hack, environmental issue, etc) and provide a brief synopsis of how they should review and possibly change their policies, plans, and procedures. Synopsis must be a..
|