Question

On September 1, 2021, Southwest Airlines borrows $40.6 million, of which $9.2 million is due next year. Show how Southwest Airlines would record the $40.6 million debt on its December 31, 2021, balance sheet

Answer 1

Answer:

see below

Explanation:

Liabilities are recorded on the left-hand side of the balance sheet. They are classified as current and long term liabilities. Current liabilities are due within one year, and long term liabilities are payable in future financial periods

Liabilities

Current liabilities

Accounts payable

Short term loans    $31.4

Total current liabilities  $31.4

Long liabilities

Long term debts   $9.2

Total long liabilities   $9.2

Total liabilities     $40.6