On January 1, Grantlan Company purchased equipment of $ 100000 with a long-term note payable. The debt is payable in annual installments of $ 20000 due on December 31 of each year. At the date of purchase, how will Grantlan Company report the note payable?

On the date of purchase,

Grantlan will report the following:

A. $ 40000 as current portion of notes payable in the current liability section. The remaining $ 60,000 will show as a notes payable in the long-term liability section.

B. $ 100,000 will show as notes payable in the long-term liability section, with no current portion.

C. $ 20,000 as current portion of notes payable in the current liability section. The remaining $ 80,000 will show as a notes payable in the long-term liability section.

D. None of the above.