Region Jet has a $50 million liability at December 31, 2021, of which $10 million is payable in 2022. In its December 31, 2021 balance sheet, the company reports the $50 million debt as a:
A) $50 million current liability in the balance sheet.
B) $50 million long-term liability in the balance sheet.
C) $10 million current liability and a $40 million long-term liability in the balance sheet.
D) $40 million current liability and a $10 million long-term liability in the balance sheet.
Answer: C
United Supply has a $5 million liability at December 31, 2021, of which $1 million is payable in each of the next five years. United Supply reports the liability in the balance sheet as a:
A) $5 million current liability.
B) $5 million long-term liability.
C) $1 million current liability and a $4 million long-term liability.
D) $4 million current liability and a $1 million long-term liability.
Answer: C
The current portion of long-term debt is:
A) The amount that will be paid within one year of the balance sheet date.
B) Reported as an asset.
C) Reported as a long-term liability.
D) None of the other answer choices is correct.
Answer: A
