Camrey Company issued a five-year, interest-bearing note payable for $50,000 on January 1, 2019. Each January Camrey is required to pay $10,000 principal on the note. What is the amount that will be reported on the long-term portion of long-term notes payable on the December 31, 2021 balance sheet?
A)$10,000
B)$40,000
C)$30,000
D)$20,000

Question

Quizplus · Accepted Answer

By December 31, 2021, Camrey Company will have made three annual payments of $10,000 each (in 2019, 2020, and 2021), reducing the original amount of $50,000 by $30,000. This leaves $20,000 to be paid in the next two years (2022 and 2023), which is the long-term portion of the note payable.

Camrey Company Issued a Five-Year, Interest-Bearing Note Payable for $50,000