Among Oslo Corp.'s short-term obligations, on its most recent statement of financial position date, are notes payable totalling $ 250,000 with the Provincial Bank. These are 90-day notes, renewable for another 90-day period. These notes should be classified on Oslo's statement of financial position as
A) current liabilities.
B) deferred charges.
C) long-term liabilities.
D) shareholders' equity.

Question

Quizplus · Accepted Answer

Notes payable that are due within one year should be classified as current liabilities on the statement of financial position. The fact that these notes are renewable does not affect their classification as current liabilities.