Effective Interest Amortization of Bond Premium or Discount Video Lessons

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Problem: On October 1, your company issued a mortgage note of $459,000 that requires monthly payments, excluding interest, of $3,000 at the end of each month, beginning October 31. On the December 31 balance sheet, the mortgage note will be reported as a: A) current liability of $27,000 and a long-term liability of $423,000. B) current liability of $36,000 and a long-term liability of $414,000. C) current liability of $9,000 and a long-term liability of $441,000. D) a long-term liability of $450,000. ā‡‹

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On October 1, your company issued a mortgage note of $459,000 that requires monthly payments, excluding interest, of $3,000 at the end of each month, beginning October 31. On the December 31 balance sheet, the mortgage note will be reported as a:

A) current liability of $27,000 and a long-term liability of $423,000.

B) current liability of $36,000 and a long-term liability of $414,000.

C) current liability of $9,000 and a long-term liability of $441,000.

D) a long-term liability of $450,000.

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