On January 1, 2014, Ermler Company, a calendar-year company, issued $1,000,000 of notes payable, of which $250,000 is due on January 1 for each of the next four years. The proper balance sheet presentation on December 31, 2014, is
A) Current liabilities, $1,000,000.
B) Long-term debt , $1,000,000.
C) Current liabilities, $500,000; Long-term Debt, $500,000.
D) Current liabilities, $250,000; Long-term Debt, $750,000.

Question

Quizplus · Accepted Answer

The $250,000 due within the next year is classified as a current liability, while the remaining $750,000 due in subsequent years is classified as long-term debt.

On January 1, 2014, Ermler Company, a Calendar-Year Company, Issued