On december 31, 2018, l inc. had a $2,400,000 note payable outstanding, due july 31, 2019. l borrowed the money to finance construction of a new plant. l planned to refinance the note by issuing long-term bonds. because l temporarily had excess cash, it prepaid $590,000 of the note on january 23, 2019. in february 2019, l completed a $3,900,000 bond offering. l will use the bond offering proceeds to repay the note payable at its maturity and to pay construction costs during 2019. on march 13, 2019, l issued its 2018 financial statements. what amount of the note payable should l include in the current liabilities section of its december 31, 2018, balance sheet?

The amount of the note payable which should L include in the current liabilities section of its December 31, 2018, balance sheet is $1,810,000

Explanation:

The computation of notes payable amount is shown below:

Notes payable = Outstanding amount of notes payable - prepaid amount of the note

where,

Outstanding amount of notes payable is $2,400,000

And, the prepaid amount of the note is $590,000

Now, put these values to the above formula

So, the value would be equal to

= $2,400,000 - $590,000

= $1,810,000

The $3,900,000 amount is not considered in the computation part. Thus, it is ignored

Hence, the amount of the note payable which should L include in the current liabilities section of its December 31, 2018, balance sheet is $1,810,000

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