Reference no: EM133020407

Question - At December 31, 20x1, Pitchfork Company reports the following balances for its liability accounts:

7% note payable issued Oct. 1, 20x1 maturing Sept. 30, 20x2 $375,000

9% note payable, issued Jan 2, 20x1, due June 30, 20x2 $800,000

8% note payable issued Apr 1, 20x1, payable in 6 equal annual installments of principle in the amount of $150,000 beginning April 1, 20x2 $900,000

Additional Information: On December 10, 20x1, Pitchfork began discussions with the bank to refinance the 7% note payable on a long-term basis. No agreement had been reached at December 31, 20x1.

On Dec 31, 20x1, Pitchfork signed an agreement to borrow up to $800,000 to refinance the 9% note on a long-term basis. The financing agreement called for borrowings not to exceed 80% of the value of the collateral Pitchfork was providing. At Dec 31, 20x1, the value of the collateral was $700,000.

Required - What is the amount of the notes payable that should be recorded as a current liability on the December 31, 20x1, Balance Sheet?