For Intermediate Accounting Class – Management A
The manager of Centura Ltd has asked you to classify a $500,000 loan due for repayment in nine months as a non-current liability in the statement of financial position. The company’s total assets are $2 million.
As a student of intermediate accounting, you have been asking to make a deep analysis and discuss this following questions:
- The impact of this classification
- What the reasons might be for the request?
- Whether any party is likely to suffer from treatment?
- What would you do?
Post your answers in this page in “Leave a comment” menu at the latest of Friday 10th June 2011. You can answer it in English or Bahasa Indonesia, however putting your effort to practice your English would be a valuable additional point.
This case study is taken from:
Bazley, M., Hancock , P., Berry, A., and Jarvis, R. 2004. Contemporary Accounting. 5th Edition. Thomson Learning. Australia. Chapter 4, p.95.