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my balance shows an adjusted balance in the long term notes payable account of 375000 a...

my balance shows an adjusted balance in the long term notes payable account of 375000 a march 31 2011 review the balance sheet Jud prepared and make a reasonable assumption about what 375000 was most logically used for the business explain whether or not this is generally considered a good use of borrowed funds and why ?

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a balance of 375000 is long term notes payable, it is assumed that amount obtained from long term notes payable is used for purchase of long term asset i.e machine which would be used for a period of 10 years and it is would be paid over a period of 5 years. Yes it is a good use of funds borrowed because fund is borrowed from long term source and it is used for financing long term assets which will provide benefits and service over the years and amortization of cost would be spread over the life of machine

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