Question

If a nursery owner has a $250,000 mortgage on his land and he owes Farm Credit Service $30,000 for this year's payment, what amount should be entered on the non-current liability line of the financial statement?

Answer 1

The amount that should be entered on the non-current liability line of the financial statement is $250,000, which represents the nursery owner's mortgage on the land.

Step-by-step explanation:

The non-current liability line of the financial statement should include the amount of the mortgage on the nursery owner's land. In this case, the owner has a $250,000 mortgage, so that amount should be entered on the non-current liability line. The $30,000 owed to Farm Credit Service for this year's payment does not need to be included in the non-current liability line as it represents a current liability.