United Supply has a $5 million liability at December 31,2012,of which $1 million is payable in each of the next five years.United Supply reports the liability on the balance sheet as:

Question

Quizplus · Accepted Answer

Only $1 million is payable in each of the next five years, making it a current liability. The remaining $4 million is a long-term liability. Therefore, the liability is split into a $1 million current liability and a $4 million long-term liability on the balance sheet.

United Supply Has a $5 Million Liability at December 31,2012,of