(g) The company is currently in litigation over a claimed overpayment of income tax of $13,000. In the opinio of counsel, the claim is valid. The company is contingently liable on guaranteed notes worth $12,000. TO JLul. L ILUSEJ UUTIOL Instructions: Prepare a properly classified balance sheet. Include all notes and parenthetical notations necessary to properly disclose the essential financial data. em 3-41 Classification of Liabilities 4 The accountant for Sierra Corp. prepared the following schedule of liabilities as of December 31, 2015. Accounts payable..... Notes payable-trade. Notes payable-bank. Wages and salaries payable Interest payable.. Mortgage note payable-10 % Mortgage note payable-12 % Bonds payable $65,000 19,000 80,000 1,500 14,300 60,000 150,000 200,000 $589,800 Total.... C3The Balance Sheet and Notes to the Financial Statements E OC 3-51 The following additional information pertains to these liabilities. (a) All trade notes payable are due within six months of the balance sheet date. (b) Bank notes payable include two separate notes payable to First Interstate Bank . A 530,000, 896 note issued March 1, 2013, payable on demand, Interest is payable every six months 2. A one-year, $50,000, 112 96 note issued January 2, 2015, On December 30, 2015, Sierra negotiated a written agreement with First Interstate Bank to replace the note with a two-year, $50,000, 10 % note to be issued January 2, 2016. (c) The 1096 mortgage note was issued October 1, 2012, with a term of 10 years. Terms of the note give the holder the right to demand immediate payment if the company fails to make a monthly inter- est payment within 10 days of the date the payment is due. As of December 31, 2015, Sierra is three months behind in paying its required interest payment. (d) The 1296 mortgage note was issued May 1, 2009, with a term of 20 years. The current principal amount due is $150,000. Principal and interest are payable annually $22,000 is due April 30, 2016. The payment includes interest of $18,000. (e) The bonds payable are 10-year, 8 % bonds, issued June 30, 2006. April 30. A payment of on