On April 1, 2020, Dsseldorf Ltd. borrowed $500,000 for 20 years. Principal repayments of $25,000 and interest

Question:

On April 1, 2020, Düsseldorf Ltd. borrowed $500,000 for 20 years. Principal repayments of $25,000 and interest at 7% are due annually on March 31.

Required

a. Prepare all of the journal entries required in relation to the loan for the year ended June 30, 2020.

b. What is the impact on the current ratio of reclassifying the current portion of the long-term loan?

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Understanding Financial Accounting

ISBN: 9781119406921

2nd Canadian Edition

Authors: Christopher D. Burnley

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Question Posted: Jul 25, 2019 01:25 PM

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On April 1, 2020, Dsseldorf Ltd. borrowed $500,000 for 20 years. Principal repayments of $25,000 and interest

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a April 1 Cash 500000 LongTerm Loan Payable 500000 To record the 20year ...View the full answer

Understanding Financial Accounting

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