Question

Asay Corporation trial balance included the following account balances at 12/31/2016:

Account payable 500,000
accumulated depreciation 200,000
Income tax payable 100,000
Bonds Payable due 2020 300,000
Unearned service revenue 400,000
5 year note payable, due in 2017
What amount should be included in the current liability section of Asay's 12/31/2016 balance sheet?

Answer 1

The current liability section of Asay Corporation's balance sheet should include accounts payable, income tax payable, bonds payable, unearned service revenue, and the current portion of a 5-year note payable.

Step-by-step explanation:

The current liability section of Asay Corporation's 12/31/2016 balance sheet should include the following amounts:

• Accounts Payable: $500,000
• Income Tax Payable: $100,000
• Bonds Payable due 2020: $300,000
• Unearned Service Revenue: $400,000
• 5-year Note Payable, due in 2017 (current portion): The remaining balance of the note payable that is due within one year

The current portion of the 5-year Note Payable should be included in the current liability section since it is due within one year from the balance sheet date.