This continues the Pure Water, Inc., example from the Continuing Problem in Chapter 8. Pure Water, Inc., purchased some of its fixed assets during 201 2 using long-term debt. The following table summarizes the nature of this long-term debt. Assume the fiscal year ends on December 31 .

Requirements
1 . C alculate the interest expense that Pure Water, Inc., should accrue as of December 31 , 201 2. Round your answer to the nearest dollar. Use 365 days for the note payable.
2. Prepare the balance sheet presentation at December 31 , 201 2 for all long-term debt indicating the portion that should be classified as current and the portion that should be classified aslong-term.

Annual Interest Date Item Rate Amount Payment Terms May 18 Note payable | $35,800 | Five equal annual payments of principal plus accrued interest are due on May 18 8% of each year. | Mortgage payable | 6% |SI 00,000 | Semiannual payments of $5267 due on March 1 and September 1 of each year. Sep 1