On July 1, 2014, Granville Ltd. borrowed $9,000 by signing a two-year, 6% note payable. The note is payable in two annual blended principal and interest instalments of $4,909 on June 30. Adjusting journal entries are recorded annually at year end on December 31.
Instructions
(a) Prepare an instalment payment schedule for the term of the note. Round all amounts to the nearest dollar.
(b) Record (1) the issue of the note on July 1, 2014; (2) the accrual of interest on December 31, 2014; and (3) the first payment on June 30, 2015.
(c) What amounts would be reported as current and non-current in the liabilities section of Granville's statement of financial position on December 31, 2015?