CURRENT LIABILITIES [SHOW SOLUTION] 1) What amount should Sabina Company report as current liabilities on December 31, 2019? The unadjusted trial balance of Sabina Company at December 31, 2019 included the following account balances. The 2019 financial statements were issued on March 31, 2020. Accounts receivable - P2,000,000 Accounts payable - 1,500,000 Bank note payable - 600,000 Mortgage note payable - 1,200,000 Deferred tax liability - 1,000,000 The bank note, issued August 1, 2019, is due on July 31, 2020 with interest at a rate of 10% payable at maturity. The mortgage note is due on March 1, 2020. Interest at 9% has been paid up to December 31, 2019. The entity intended at December 31, 2019 to refinance the note on due date with a new 10-year mortgage note. On March 1. 2020, the entity paid P250,000 in cash on the principal balance and refinanced the remaining P950,000. Included in the accounts receivable balance at December 31, 2019 were two subsidiary accounts that had been overpaid and the credit balances totaling P200,000. The accounts were of two major customers who were expected to order more merchandise from the entity and apply the overpayment to those future purchases. On November 1, 2019, the entity rented a portion of its factory to a tenant for P300,000 per year, payable in advance. The payment for the 12 months ended October 31, 2020 was received as required and was credited to rent revenue. 2) What amount should Sabina Company report as noncurrent liabilities on December 31, 2019? The unadjusted trial balance of Sabina Company at December 31, 2019 included the following account balances. The 2019 financial statements were issued on March 31, 2020. Accounts receivable - P2,000,000 Accounts payable - 1,500,000 Bank note payable - 600,000 Mortgage note payable - 1,200,000 Deferred tax liability - 1,000,000 The bank note, issued August 1, 2019, is due on July 31, 2020 with interest at a rate of 10% payable at maturity. The mortgage note is due on March 1, 2020. Interest at 9% has been paid up to December 31, 2019. The entity intended at December 31, 2019 to refinance the note on due date with a new 10-year mortgage note. On March 1, 2020, the entity paid P250,000 in cash on the principal balance and refinanced the remaining P950,000. Included in the accounts receivable balance at December 31, 2019 were two subsidiary accounts that had been overpaid and the credit balances totaling P200,000. The accounts were of two major customers who were expected to order more merchandise from the entity and apply the overpayment to those future purchases. On November 1, 2019, the entity rented a portion of its factory to a tenant for P300,000 per year, payable in advance. The payment for the 12 months ended October 31, 2020 was received as required and was credited to rent revenue