At the beginning of the year, your company borrows $15,900 by signing a three-year promissory note that states an annual interest rate of 7% plus principal repayments of $5,300 each year. Interest is paid at the end of the second and fourth quarters, whereas principal payments are due at the end of each year. How does this new promissory note affect the current and non-current liability amounts reported on the classified balance sheet prepared at the end of the first quarter

Increase current liabilities by $278.25; increase non-current liabilities by $15,900.

Explanation:

Quarterly interest expense = Amount borrowed * (Annual interest rate / 4) = $15,900 * (7% / 4) = $15,900 * 1.75% = $278.25

Since, interest is paid at the end of the second and fourth quarters and principal payments are due at the end of each year, that means both the interest expense and the principal are still liabilities at the end of the first quarters.

It should be noted that a three-year promissory note of $15,900 is a non-current liability since its tenure is more than one year, while the quarterly interest expense of $278.25 for the first quarter is a current liability since it is dues within a year.

Therefore, the effect of this new promissory note on the current and non-current liability amounts reported on the classified balance sheet prepared at the end of the first quarter will be as follows:

Increase current liabilities by $278.25; increase non-current liabilities by $15,900.

the correct answer is:

it required the president to inform congress within forty-eight hours of any new troop commitment.

the war powers resolution (1973) is a federal law designed to limit the u.s. president’s ability to initiate or intensify military actions abroad without the approval of the congress.

it establishes that the president can send armed forces into action abroad only by declaration of war by congress, statutory authorization, or in case of a national emergency created by attack upon the united states, its territories or possessions, or its armed forces.

it requires the president to notify congress within 48 hours of sending armed forces to military action.

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