Question
Neptune Corporation is preparing its December 31, 2018, balance sheet. The following items may be reported as either a current or long-term liability. a) Bonuses
Neptune Corporation is preparing its December 31, 2018, balance sheet. The following items may be reported as either a current or long-term liability. a) Bonuses to key employees based on net income for 2018 are estimated to be $120,000 which will be paid in January, 2019. b) A 10% bonds payable of 1,000,000 was issued on December 31, 2018, due on December 31, 2023. c) On October 1, 2018, the company borrowed $800,000 for 5 years at 8% per year. Interest is to be paid half-yearly on April 1 of every year. d) During the year, customer advances of $220,000 were received; $110,000 of this amount was earned by December 31, 2018. e) On December 15, 2018, the company declared a $1.20 per share dividend on the 60,000 shares of common stock outstanding, to be paid on January 25, 2019. f) Treasury stock of $45,000 has been recorded at cost. g) Unpaid salaries $25,000. h) Notes payable of $440,000 is due on 31st January, 2020.
Instructions
For each item above indicate the dollar amounts to be reported as a current liability and as a long- term liability, if any.
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