Raglan Ltd. issued a five-year note payable for $85,000 on January 1, 2012. Each January the company is required to pay $17,000 on the note. How will this note be reported on the December 31, 2013 statement of financial position?
A)Non-current liability, $85,000
B)Non-current liability, $68,000
C)Non-current liability, $68,000; Current liability, $17,000
D)Non-current liability, $51,000; Current liability, $17,000

Question

Quizplus · Accepted Answer

By December 31, 2013, Raglan Ltd. would have paid $34,000 ($17,000 each for 2012 and 2013), leaving $51,000 as a non-current liability. The next $17,000 due in 2014 is a current liability.