United Supply has a $5 million liability at December 31,2018,of which $1 million is payable in each of the next five years.United Supply reports the liability on the balance sheet as a:

Question

Quizplus · Accepted Answer

Only $1 million is payable within the next year, so it should be reported as a current liability. The remaining $4 million is due in the following years, so it should be reported as a long-term liability. Thus, the liability should be split between current and non-current portions.

United Supply Has a $5 Million Liability at December 31,2018,of