Question: make sure to choose the correct answer Presented below are four different situations related to Mckee plc debt obligations. Mckees next financial reporting date is
make sure to choose the correct answer
Presented below are four different situations related to Mckee plc debt obligations. Mckees next financial reporting date is December 31, 2021. The financial statements are authorized for issuance on March 1, 2022. Indicate how each of these debt obligations is reported on Mckees statement of financial position on December 31, 2021.
| 1. | Mckee has a debt obligation maturing on December 31, 2024. The debt is callable on demand by the lender at any time. | select a classification - Current Assets - Current Liability - Current Liability or Non-current Liability - Footnote Disclosure - Long-term Investments - Non-current Liability - Property, Plant and Equipment - Stockholders' Equity | ||
|---|---|---|---|---|
| 2. | Mckee also has a long-term obligation due on December 1, 2023. On November 10, 2021, it breaches a covenant on its debt obligation and the loan becomes due on demand. An agreement is reached to provide a waiver of the breach on December 8, 2021. | select a classification - Current Assets - Current Liability - Current Liability or Non-current Liability - Footnote Disclosure - Long-term Investments - Non-current Liability - Property, Plant and Equipment - Stockholders' Equity | ||
| 3. | Mckee has a long-term obligation of 400,000, which is maturing over 4 years in the amount of 100,000 per year. The obligation is dated November 1, 2021, and the first maturity date is November 1, 2022. | |||
| select a classification - Current Assets - Current Liability - Current Liability or Non-current Liability - Footnote Disclosure - Long-term Investments - Non-current Liability - Property, Plant and Equipment - Stockholders' Equity | ||||
| 4. | Mckee has a short-term obligation due February 15, 2022. Its lender agrees to extend the maturity date of this loan to February 15, 2024. The agreement for extension is signed on January 15, 2022. |
Step by Step Solution
There are 3 Steps involved in it
Lets break down each scenario step by step with detailed calculations keeping the financial reporting date December 31 2021 and the financial statement issuance date March 1 2022 in mind For each scen... View full answer
Get step-by-step solutions from verified subject matter experts
