On December 1,2018,Modern Dining Products Borrowed $84,000 on a 12%,5-Year

question 85

Multiple Choice

On December 1,2018,Modern Dining Products borrowed $84,000 on a 12%,5-year note with annual installment payments of $16,800 plus interest due on December 1 of each succeeding year.On December 1,the principal amount was recorded as a long-term note payable.What amount of the note payable will be shown as current portion of Long-Term Note Payable on the balance sheet as of December 31,2018? (Round your answer to nearest whole number.)

• A) $16,800
• B) $26,880
• C) $10,080
• D) $33,600

---

Definitions:

Equivalent Units of Production

A concept in cost accounting to standardize the amount of work done by various classes of inventory, facilitating comparisons and calculations.

Conversion Costs

The total expenses of direct labor combined with manufacturing overheads used in transforming raw materials into finished goods.

FIFO Method

An inventory valuation method that assumes goods purchased first are the first sold, standing for "First-In, First-Out."

Conversion Costs

The total expenses of direct labor together with manufacturing overheads spent in transforming raw materials into completed products.