At December 31, MediSharp Precision Instruments owes $50,000 on accounts payable, salary payable of $16,000, and income

Question:

At December 31, MediSharp Precision Instruments owes $50,000 on accounts payable, salary payable of $16,000, and income tax payable of $8,000. MediSharp also has $280,000 of bonds payable that were issued at face value that require payment of a $35,000 installment next year and the remainder in later years. The bonds payable require an annual interest payment of $4,000, and MediSharp still owes this interest for the current year.

Requirement

1. Report MediSharp’s liabilities on its classified balance sheet. List the current liabilities in descending order (largest first, and so on), and show the total of current liabilities.

Face Value
Face value is a financial term used to describe the nominal or dollar value of a security, as stated by its issuer. For stocks, the face value is the original cost of the stock, as listed on the certificate. For bonds, it is the amount paid to the...