Question

At December 31, Medical Precision Instruments owes $60,000 on Accounts Payable, Salaries Payable of $18,000, and Income Tax Payable of $9,000. Medical also has $240,000 of Bonds Payable that were issued at face value that require payment of a $30,000 installment next year and the remainder in later years. The bonds payable require an annual interest payment of $5,000, and Medical still owes this interest for the current year. Report Medical's liabilities on its classified balance sheet on December 31, 2018 Medical Precision Instruments Balance Sheet (Partial) December 31, 2018 Liabilities

Answer 1

Ans.	MEDICAL   PRECISION INSTRUMENTS
	Balance Sheet (Partial)
	31-Dec-18
	Liabilities
	Current liabilities:
	Accounts payable	$60,000
	Salaries payable	$18,000
	Income tax payable	$9,000
	Current bonds payable	$30,000
	Interest payable	$5,000
	Total current liabilities		$122,000
	Long term debts:
	Bonds payable (long term)	$210,000
	Total long term debts		$210,000
	Total Liabilities		$332,000
	*If a liability is due within one year, then it is known as a current liability. Installment on bonds
	payable is current liability by the amount which is due in next year ($30,000).
	The remaining amount of bonds payable will be listed as a long term bonds payable.
	Long term bonds payable =   Bonds payable - Current bonds payable
	$240,000 - $30,000   = $210,000