Question

Joe borrowed $100,000 (a four-year loan at 10 percent interest) on January 2, 2020. During the course of the year, he paid back $30,000 on that debt. What would his December 31, 2020 balance sheet show for this debt

Answer 1

Joe's December 31, 2020 balance sheet would show a Long-term Loan Balance of $70,000.

What is the balance sheet?

The balance sheet is a financial statement that shows the balances of the assets, liabilities, and equity of a person or an entity at a stated date.

The balance sheet follows the accounting equation that equates assets to liabilities and equity.

Data and Calculations:

Loan receipt on Jan. 2, 2020 = $100,000

Repayment during the year = $30,000

Loan balance = $70,000 ($100,000 - $30,000)

Interest Expense = $10,000 ($100,000 x 10%)

Thus, Joe's December 31, 2020 balance sheet would show a Long-term Loan Balance of $70,000.

Learn more about the balance sheet at https://brainly.com/question/24401217

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