When a Long-Term Note Payable That Requires Annual Installment Payments

question 64

True/False

When a long-term note payable that requires annual installment payments is initially recorded,it is first recorded as a long-term note payable.Then,at the same date,a second entry is made to reclassify the current portion.

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Definitions:

Paid in Capital in Excess

Financial capital received from investors above the par value of the shares issued, also known as additional paid-in capital.

Common Stock

Equity ownership in a corporation, giving holders voting rights and a share in the company’s profits through dividends.

Par Value

The face value of a bond or stock as stated by the issuing company, which does not necessarily match its market value.

Common Stock

Equity securities representing ownership in a corporation, giving shareholders voting rights and a share in the company's profits through dividends.