Antigonish Corporation includes the following items in its liabilities at its year end, December 31, 2014:
1. Accounts payable, $420,000, due to suppliers in January 2015
2. Notes payable, $1.5 million, maturing on various dates in 2017
3. Deposits from customers on equipment ordered from Antigonish, $250,000
4. Salaries payable, $37,500, due on January 14, 2015
5. Bonds payable, $2.5 million, maturing on July 1, 2015. The company has been able to renegotiate an agreement from the bondholders to roll over this maturity date to July 1, 2018. This agreement was settled on January 21, 2015.
Instructions
In answering each of the following, note any differences between IFRS and ASPE.
(a) What are the essential characteristics that make an item a liability?
(b) What distinguishes a current liability from a long-term liability?
(c) What distinguishes a financial liability from a non-financial liability?
(d) Indicate for each of the above liabilities if it should be reported as current or non-current at the December 31, 2014 report date.