Assume you are preparing a balance sheet dated December 31,2014.Which of the following is NOT a long-term liability?
A) bonds payable due June 30, 2016
B) bonds payable due June 30, 2015
C) bonds payable due December 31, 2016
D) bonds payable due December 31, 2020

Question

Quizplus · Accepted Answer

Since the balance sheet is prepared as of December 31, 2014, any liability that is due to be paid off within one year from that date is considered a current liability. Option B - bonds payable due June 30, 2015 - is due within one year and thus, is not a long-term liability. Choices A, C, and D are all due beyond one year, making them long-term liabilities.

Assume You Are Preparing a Balance Sheet Dated December 31,2014