Identify the classifications of the following accounts as either current or long-term liabilities for the December 31, 2016 balance sheet.
-An amount of money owed in 2017 to a creditor as an annual installment payment on a ten-year note, due June 30, 2022.
A)Current liability
B)Long-term liability

Question

Quizplus · Accepted Answer

The amount due in 2017 is classified as a current liability because it is payable within one year from the balance sheet date (December 31, 2016). The remainder of the note payable that is due after 2017 would be classified as a long-term liability.

Identify the Classifications of the Following Accounts as Either Current