Question

help me please ? thank you ?

19) T'challa Company reported the following information on December 31, 2017: Accounts payable 800,000 Bonds payable, due 2018 3,000,000 Premium on bonds payable 150,000 Deferred tax liability 250,000 The deferred tax liability is not related to an asset for financial reporting purposes and is expected to reverse in 2018. What total amount should be reported as current liabilities on December 31, 2017? A 3,650,000 B. 4,200,000 C. 3,900,000 D. 3,950,000

Answer 1

Solution:

The total amount to be reported as current liabilities on December,2017 is calculated as follows:

Accounts Payable	800,000
Bonds Payable,due 2018	3,000,000
Premium on bonds payable	150,000
Deferred tax liability	250,000
Current Liabilities on December, 2017	4,200,000

Note:

> Bonds payable is due in the next 12 months and hence both bonds payable and premium is included in the current liabilities.

> Deferred tax liability is expected to reverse in 2018 and hence included in the current liabilities.