Your Company borrowed $35,000 on August 1, 2020. The debt carried a 5% annual rate of interest and a one-year term. Both interest and principal are paid at the end of the loan period. How is this event reflected in the 2021 financial statements? 2021 is the second year of the loan. (Round to the nearest dollar if necessary.) O Net Income ($1,750) Net Income ($729) Net Income ($1,021) Net Income ($1,021) Cash Flow from Operating Activities ($1750)) Cash Flow from Operating Activities ($1750) Cash Flow from Operating Activities ($1750) Cash Flow from Operating Activities $0 Cash Flow from Financing Activities ($35,000) Cash Flow from Financing Activities ($35,000) Cash Flow from Financing Activities ($35,000) Cash Flow from Financing Activities ($36,750)
Your Company borrowed $35,000 on August 1, 2020. The debt carried a 5% annual rate of interest and a one-year term. Both interest and principal are paid at the end of the loan period. How is this event reflected in the 2021 financial statements? 2021 is the second year of the loan. (Round to the nearest dollar if necessary.) O Net Income ($1,750) Net Income ($729) Net Income ($1,021) Net Income ($1,021) Cash Flow from Operating Activities ($1750)) Cash Flow from Operating Activities ($1750) Cash Flow from Operating Activities ($1750) Cash Flow from Operating Activities $0 Cash Flow from Financing Activities ($35,000) Cash Flow from Financing Activities ($35,000) Cash Flow from Financing Activities ($35,000) Cash Flow from Financing Activities ($36,750)
Chapter13: Long-term Liabilities
Section: Chapter Questions
Problem 1PA: On January 1, 2018, King Inc. borrowed $150,000 and signed a 5-year, note payable with a 10%...
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