On January 1, 2021, the Merit Group issued to its bank a $61 million, five-year installment note to be paid in five equal payments at the end of each year. Installment payments of $15.480 million annually include interest at the rate of 8.5%.
What would be the amount(s) related to the note that Merit would report in its statement of cash flows for the year ended December 31, 2021?
Cashflow statement is a part of the financial statements of the company, it shows the flow of cash right from its source to its destination, it is dividend in three parts (1) cash from operating activities (2) cash from investments activities and (3) cash from financial activities.
Answer and Explanation: 1
Items in Merit's cashflow statement will be as follows
1) the instalment of $15.480 million will be recorded as payment in cash from financial...
See full answer below.
Become a member and unlock all Study Answers
Start today. Try it nowCreate an account
Ask a question
Our experts can answer your tough homework and study questions.Ask a question Ask a question
Learn more about this topic:
fromChapter 1 / Lesson 2
Financial management systems are used to manage the financial transactions of an organization. Learn about the role of a financial manager in financial management, such as in capital investments, financial reporting, and financial forecasting.