On May $1,2020,$ Christina Fashions borrowed $$92,000$ at a bank by signing a four$-$year, $6\%$ loan. The terms of the loan require equal

principal payments of $$23,000$ and accrued interest at $6\%$ due annually on April $30.$ The loan agreement requires the company to

maintain a minimum current ratio of $2\mathrm{.}0.$ The December $31,2020,$ year$-$end statement of financial position, immediately prior to the

reclassification of long$-$term debt, follows: Part $1$

Does Christina Fashions comply with the bank's current ratio requirement prior to recording the accrued interest and

reclassification of the current portion of the long$-$term loan? $($Round answer to $1$ decimal place, e$.$g$.1\mathrm{.}2.)$

Current ratio Part $2$

Prepare journal entries to record the interest payable on December $31,2020.($Credit account titles are automatically indented when

the amount is entered. Do not indent manually. If no entry is required, select $"$No entry" for the account titles and enter $0$ for the amounts.$)$

Account Titles and Explanation

Debit

Credit Prepare the journal entries to reclassify the portion of the long$-$term loan as current. $($Credit account titles are automatically

indented when the amount is entered. Do not indent manually. If no entry is required, select $"$No entry" for the account titles and enter $O$ for

the amounts.$)$

Account Titles and Explanation

Debit

CreditPart $4$

Does Christina Fashions breach the bank's current ratio requirement after preparing the journal entries above? $($Round answer to $2$

decimal places, e$.$g$.1\mathrm{.}25.)$

Current ratio

Christina Fashions

the bank's minimum current ratio.