A company has just received a mortgage from a bank to finance the purchase of a property.

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A company has just received a mortgage from a bank to finance the purchase of a property. Since the mortgage agreement specifies a fixed rate of interest and the company can calculate the interest applicable to next year, should it record interest payable for the next year as a current liability on the day the company receives the loan? Why or why not?

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Financial Accounting Tools For Business Decision Making

ISBN: 9781119594574

8th Canadian Edition

Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso, Barbara Trenholm, Wayne Irvine, Christopher D. Burnley

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