Answer:
SPLISH BROTHERS INC.
Balance Sheet (Partial)
Long-term Liabilities
Bonds Payable $720,000
Less:
Discount on bonds payable $37,000
$683,000
Notes payable $72,000
Total Long-term Liabilities $755,000
Explanation:
Long term Liabilities are those liabilities which will be paid after more than one year time period.
Bonds are usually long term liabilities because of the long maturity period of e.g 5 years 10 years etc. In this question the bond have 4 years to maturity until 2026. Discount n the bond is an contra liability account which needs to be deducted from the face value of the bond to report the net payable value.
Note Payable is also classified as long term liability because it is usually payable after 1 years time period. In this question the Note will be due after 2 years time in 2024.
Answer:
Total long-term liabilities = $755,000
Explanation:
SPLISH BROTHERS INC
Balance Sheet (Partial) as at December 31, 2022
Details ($) ($)
Long-term Liabilities
Bond payable (due 2026) 720,000
Discount on bond payable (37,000) 683,000
Notes payable (due 2024) 72,000
Total long-term liabilities 755,000
