On December 31, 2012, Alexander Company had $1,235,900 of short-term debt in the

Question

On December 31, 2012, Alexander Company had $1,235,900 of short-term debt in the form of notes payable due February 2, 2013. On January 21, 2013, the company issued 23,870 shares of its common stock for $44 per share, receiving $1,050,280 proceeds after brokerage fees and other costs of issuance. On February 2, 2013, the proceeds from the stock sale, supplemented by an additional $185,620 cash, are used to liquidate the $1,235,900 debt. The December 31, 2012, balance sheet is issued on February 23, 2013. Show how the $1,235,900 of short-term debt should be presented on the December 31, 2012, balance sheet.

Explanation / Answer

www.solutioninn.com/business/accounting/financial Refinancing of Short-Term Debt On December 31, 2010, Alexander Company had $1,200,000 of short-term debt in the form of notes payable due February 2, 2011. On January 21, 2011, the company issued 25,000 shares of its common stock for $36 per share, receiving $900,000 proceeds after brokerage fees and other costs of issuance. On February 2, 2011, the proceeds from the stock sale, supplemented by an additional $300,000 cash, are used to liquidate the $1,200,000 debt. The December 31, 2010, balance sheet is issued on February 23, 2011. Show how the $1,200,000 of short-term debt should be presented on the December 31, 2010, balance sheet, including note disclosure.

Related Questions

Navigate

• Browse (All)
• Browse O
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.