On January 1, 2018, Howard Company, a calendar-year company, issued $900,000 of notes payable, of which $225,000 is due on January 1 for each of the next four years. The proper balance sheet presentation on December 31, 2018, is

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The notes payable due within one year, which is $225,000, should be classified as current liabilities. The remaining $675,000 ($900,000 total notes payable - $225,000 current portion) should be classified as long-term debt. Therefore, the proper balance sheet presentation on December 31, 2018, is Current Liabilities, $225,000; Long-term Debt, $675,000.

On January 1, 2018, Howard Company, a Calendar-Year Company, Issued