Final answer:
The current portion of long-term debt is the part of a bond or long-term note payable that is due within the next fiscal year. It's considered a current liability and affects the company's liquidity. The present value of a bond incorporates its face value, coupon rate, and maturity date, reflecting how much a buyer would pay for it.
Step-by-step explanation:
In financial accounting, a portion of long-term notes payable or bonds that matures within the next fiscal year, or is callable/due on demand, is referred to as a current portion of long-term debt. This part of the debt is categorized as a current liability on the balance sheet because it represents an obligation that must be paid within the upcoming year. It is important for companies to identify this portion separately from the rest of the long-term debt as it affects the company's working capital and liquidity position.
Bonds are a form of debt security that consist of a face value, which is the principal amount the issuer agrees to repay at maturity date, and a coupon rate that represents the interest payment to the bondholder. The present value of a bond is calculated using the bond's face value, coupon rate, maturity date, and prevailing market interest rates, and this value indicates the maximum amount a buyer is willing to pay at a given time.