Classification of Short Term Obligations Expected to be Refinanced
- What are Short term obligations?
- What are Long-term obligations?
- What does refinancing a short term obligation on a long term basis mean?
- What types of short term obligations are to be classified as current liabilities?
- Under what conditions should a short-term obligation other than one classified as a current liability be excluded from current liabilities?
- What does "intent to refinance" mean?
- How can the ability to consummate the refinancing of a short term obligation be demonstrated?
- If a financing agreement is involved, what conditions must be present?
- If a short-term obligation is repaid after the balance sheet date with a current asset and subsequently a long-term obligation or equity security is issued whose proceeds are used to replace current assets before the balance sheet is issued, how should the short term obligation be classified in the balance sheet?
- Explain the rationale for the answer in the previous question.
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