Exercise 14-20 At December 31, 2017, Riverbed Company has outstanding three long

Question

Exercise 14-20

At December 31, 2017, Riverbed Company has outstanding three long-term debt issues. The first is a $2,020,000 note payable which matures June 30, 2020. The second is a $5,060,000 bond issue which matures September 30, 2021. The third is a $12,230,000 sinking fund debenture with annual sinking fund payments of $2,446,000 in each of the years 2019 through 2023.

Prepare the required note disclosure for the long-term debt at December 31, 2017.

Long-term Debt 2018 $

2019 $

2020 $

2021 $

2022 $

Explanation / Answer

Long term debt means an amount owed for a period exceeding 12 months from the date of the balance sheet. less than 12 months debts will classified as current debt.

Long term debt 2017 $2,020,000 + $5,060,000 + $12,230,000 = $19,310,000 2018 $2,020,000+$5,060,000 + $12,230,000 - $2,446,000 = $16,864,000 2019 $5,060,000 + $12,230,000 - $2,446,000 - $2,446,000 = $12,398,000 2020 $12,230,000 - $2,446,000 - $2,446,000 - $2,446,000 = $4,892,000 2021 $12,230,000 - $2,446,000 - $2,446,000 - $2,446,000 - $2,446,000 = $2,446,000 2022 0

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