On December 31, 2014, the Wagner Company had the following liabilities: $\begin{array}{llcc}
\$150,000& \text { Trade accounts payable} \
& \text { $ 11 \% $ note payable, maturing in equal installments of $ \$ 40,00 $ } \
120,000&\text { per year on December 30 through 2017 } \
& \text { $ 12 \% $ note payable, issued October 15,2014 , maturing } \
70,000& \text { Februa1y 15,20115 } \

\end{array}$
On December 31, Wagner signed a binding agreement with its bank to refinance the 12% note through February 14, 2017, at a variable interest rate. What is the amount of Wagner's current liabilities on December 31, 2014?
A) $150,000
B) $190,000
C) $230,000
D) $260,000

Question

On December 31, 2014, the Wagner Company had the following liabilities: $\begin{array}{llcc}
\$150,000&  \text {  Trade accounts payable}   \
& \text { \( 11 \% $ note payable, maturing in equal installments of $ \$ 40,00 $ } \
 120,000&\text {  per year on December 30 through 2017 } \
& \text { $ 12 \% $ note payable, issued October 15,2014 , maturing } \
70,000& \text {  Februa1y 15,20115 } \

\end{array}\)
 On December 31, Wagner signed a binding agreement with its bank to refinance the 12% note through February 14, 2017, at a variable interest rate. What is the amount of Wagner's current liabilities on December 31, 2014?
A) $150,000
B) $190,000
C) $230,000
D) $260,000

Quizplus · Accepted Answer

The current liabilities on December 31, 2014, include the trade accounts payable of $150,000 and the current portion of the 11% note payable, which is $40,000. The 12% note payable is not a current liability because it does not mature within one year. Therefore, the total current liabilities are $150,000 + $40,000 = $190,000.

On December 31, 2014, the Wagner Company Had the Following