BUS 251 Chapter Notes - Chapter 10: Capital Asset, Debenture, Canada Revenue Agency
12 Dec 2014
School
Department
Course
Professor
Document Summary
The difference is that the maturity date of long-term notes is longer than one year, while that of short-term notes is within one year. The terms of the long-term notes, such as the interest rate, payment dates, and maturity date of the notes, are specified in formal agreements. There may be restrictions or conditions that the borrowers must meet during the loan period (covenants) o. The covenants may specify that the borrowers cannot borrow additional money or pay dividends during the loan period. The accounting for long-term notes is very similar to that for short-term notes. Long term loans with equal blended monthly payments. Mortgage loan: a long-term debt with a capital asset (building and equipment) pledged as collateral or security for the loan o. If the borrower fails to repay the loan, the lender has the legal right to have the asset seized and sold for the repayment of the debt.
