Question

Consider the following abbreviated financial statements for Parrothead Enterprises:

PARROTHEAD ENTERPRISES								PARROTHEAD ENTERPRISES
2014 and 2015 Partial Balance Sheets								2015 Income Statement
Assets				Liabilities & Owners’ Equity				Sales	12073
	2015	2014			2015	2014		Costs	5574
Current assets	971	941		Current liabilities	301	497		Depreciation	1002
Net fixed assets	3865	4053		Long-term debt	2099	2195		Interest	176

During 2015, Parrothead Enterprises raised $352 in new long-term debt. How much long-term debt must Parrothead Enterprises have paid off during the year

Answer 1

CALCULATION OF THE LONG TERM DEBT PAIF OFF DURING THE YEAR
Opening Long Term Debt Balance =	$                       2,195
Add: Raised debt in the current year	$                           352
Total	$                       2,547
Less: Closing Balance of Long Term Debt	$                       2,099
AMOUNT PAID OFF DURING THE YEAR	$                           448
Answer = Amount paid off during the year = $ 448