Question

Mill Co.'s trial balance included the following account balances at December 31, Year 6:

Accounts payable: $15,000
Bonds payable, due Year 7: $25,000
Discount on bonds payable, due Year 7: $3,000
Dividends payable 1/31/Year 7: $8,000
Notes payable, due Year 8: $20,000
What amounts should be included in the current liability section of Mill's December 31, Year 6, balance sheet?
A) $71,000
B) $51,000
C) $65,000
D) $45,000

Answer 1

D) $45,000

Step-by-step explanation:

The computation of the amount which is included in the current liability section is shown below:

= Account payable balance + bonds payable - discount on bonds payable + dividend payable

= $15,000 + $25,000 - $3,000 + $8,000

= $45,000

The current liability is that liability which is arise for one year. Since, the notes payable is a long term liabilities so we do not consider in the computation part.