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Homework answers / question archive / On December 31, 2020, Isle Co

On December 31, 2020, Isle Co

Accounting

On December 31, 2020, Isle Co. has $6,000,000 of short-term notes payable due on February 14, 2021. On January 10, 2019, Isle arranged a line of credit with Beach Bank which allows Isle to borrow up to $4,500,000 at one percent above the prime rate for three years. On February 2, 2021, Isle borrowed $3,600,000 from Beach Bank and used $1,500,000 additional cash to liquidate $5,100,000 of the short-term notes payable. The amount of the short-term notes payable that should be reported as current liabilities on the December 31, 2020 balance sheet which is issued on March 5, 2021 is    .

a. $0.

b. $900,000.

c. $1,500,000.

d. $2,400,000.

Why this question is D, I need detailed explanation with calculation, thanks.

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