question archive On December 31, 2020, Windsor Company has $7,049,000 of short-term debt in the form of notes payable to Gotham State Bank due in 2021
On December 31, 2020, Windsor Company has $7,049,000 of short-term debt in the form of notes payable to Gotham State Bank due in 2021
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On December 31, 2020, Windsor Company has $7,049,000 of short-term debt in the form of notes payable to Gotham State Bank due in 2021. On December 28, 2020, Windsor enters into a refinancing agreement with Gotham that will permit it to borrow up to 60% of the gross amount of its accounts receivable. Receivables are expected to range between a low of $6,049,000 in May to a high of $8,047,000 in October during the year 2021. The interest cost of the maturing short-term debt is 15%, and the new agreement calls for a fluctuating interest at 1% above the prime rate on notes due in 2025. Windsor's December 31, 2020, balance sheet is issued on February 15, 2021. Prepare a partial balance sheet for Windsor at December 31, 2020, showing how its $7,049,000 of short-term debt should be presented.
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