Four years ago, a company issued a fully amortizing annual-pay bond with a maturity of six years. the appropriate balance sheet treatment of this security is to record the liability as a long-term liability.
What are long-term liabilities?
Long-term liabilities are monies owing by a corporation to third parties that are due after a year, also referred to as long-term debts. This distinguishes them from current liabilities, which must be paid off within a year for a business. The balance sheet shows both current liabilities and long-term liabilities.
What is purpose of balance sheet?
A balance sheet can be used to rapidly obtain an overview of your company's financial situation at any given time. With the use of a balance sheet, income statement, and cash flow statement, business leaders can assess the financial standing of their company.
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