Jamison Company has the following obligations at December 31:For each obligation, indicate whether it should be classified as a current liability. (Assume an operating cycle of less than one year.) 1. (a) A note payable for $100,000 due in 2 years. Not a current liabilityCurrent liability (b) A 10-year mortgage payable of $300,000 payable in ten $30,000 annual payments. Not a current liabilityCurrent liability (c) Interest payable of $15,000 on the mortgage. Current liabilityNot a current liability (d) Accounts payable of $60,000.
Jamison Company has the following obligations at December 31:For each obligation, indicate whether it should be classified as a current liability. (Assume an operating cycle of less than one year.) 1. (a) A note payable for $100,000 due in 2 years. Not a current liabilityCurrent liability (b) A 10-year mortgage payable of $300,000 payable in ten $30,000 annual payments. Not a current liabilityCurrent liability (c) Interest payable of $15,000 on the mortgage. Current liabilityNot a current liability (d) Accounts payable of $60,000.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Jamison Company has the following obligations at December 31:
For each obligation, indicate whether it should be classified as a current liability. (Assume an operating cycle of less than one year.)
1.
| (a) | A note payable for $100,000 due in 2 years. |
Not a current liabilityCurrent liability
|
||
| (b) | A 10-year mortgage payable of $300,000 payable in ten $30,000 annual payments. |
Not a current liabilityCurrent liability
|
||
| (c) | Interest payable of $15,000 on the mortgage. |
Current liabilityNot a current liability
|
||
| (d) | Accounts payable of $60,000. |
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