Loan

Good day to you

The following information is available about Andrew business as at 30/sep/2006

Loan(repayable in 4 equal instalments starting 1 Jan 2007). 100000

What are the correct figure for current asset or current liability

(note that what I have written is part of a question since i felt that this was part only was relevant to my doubt)

For the correct answer is an accrual of 25000

In my answer i didn’t assume it was a prepayment or an accrual that is relevant for this year but I thought of it as an prepayment that is relevant for the year of 2007

I thought since it paid in january 2007…i thought it is a prepayment(Relevant only for 2007)for the next year that covers till march 2007

However when I looked at the markscheme this 25000 was an a current liability so I assume this is an accrual for the 3 months from october to december

I also think that the information available for 30/sep/2006 is not the year end financial statement but 31/dec/2006 is actually the year end

I just wanted you to check whether my thought for this question is correct..please let me know whether it is correct or wrong

Thank you in advance