A loan on a life insurance policy is shown as a noncurrent liability even though the debt has no due date.

Question

Quizplus · Accepted Answer

Even though the loan on a life insurance policy may not have a set due date, it is still classified as a noncurrent liability because it is not expected to be repaid within the next year. Noncurrent liabilities are those that are not due within the next 12 months from the date of the balance sheet. Therefore, the loan on a life insurance policy is considered a noncurrent liability.

A Loan on a Life Insurance Policy Is Shown as a Noncurrent