Use the information above to answer the following question.How would this information be reported on the balance sheet at the end of the first quarter?
A)$400 as interest expense and $20,000 under long-term debt.
B)$400 as interest payable,$5,000 as current portion of long-term debt under current liabilities,and $15,000 under long-term debt.
C)$1,600 of interest under current liabilities,$5,000 as current portion of long-term debt under current liabilities and $15,000 under long-term debt.
D)$400 as interest payable under current liabilities and $20,000 under long-term debt.

Question

Quizplus · Accepted Answer

The interest expense of $400 would not be reported on the balance sheet, but the interest payable would be reported under current liabilities. The current portion of the long-term debt ($5,000) would also be reported under current liabilities, and the remaining long-term debt ($15,000) would be reported under long-term liabilities. Therefore, the best choice is B.

Use the Information Above to Answer the Following Question