Transit Airlines provides regional jet service in the Mid-South. The following is information on liabilities of Transit at December 31,2024. Transit's fiscal year ends on December 31 . Its annual financial statements are issued in April. 1. Transit has outstanding 8.4% bonds with a face amount of $67 million. The bonds mature on July 31,2030 . Bondholders have the option of calling (demanding payment on) the bonds on July 31,2025 , at a redemption price of $67 million. Market conditions are such that the call option is not expected to be exercised. 2. A $45 million 8% bank loan is payable on October 31,2027 . The bank has the right to demand payment after any fiscal year-end in which Transit's ratio of current assets to current liabilities falls below a contractual minimum of 1.9 to 1 and remains so for six months. That ratio was 1.75 on December 31,2024 , due primarily to an intentional temporary decline in parts inventories. Normal inventory levels will be reestablished during the sixth week of 2025. 3. Transit management intended to refinance $53 million of 4% notes that mature in May 2025 . In late February 2025 , prior to the issuance of the 2024 financial statements, Transit negotiated a line of credit with a commercial bank for up to $48 million any time during 2025. Any borrowings will mature two years from the date of borrowing. 4. Transit is involved in a lawsuit resulting from a dispute with a food caterer. On February 13, 2025. judgment was rendered against: Transit in the amount of $42 million plus interest, a total of $43 million. Transit plans to appeal the judgment and is unable to predict its outcome though it is not expected to have a material adverse effect on the company. Required: 1. How should the 8.4% bonds be classified by Transit among liabilities in its balance sheet? 2. How should the 8% bank loan be classifled by Transit among liabilities in its balance sheet? 3. How should the 4% notes be classified by Transit among liabilities in its balance sheet? 4. How should the lawsuit be reported by Transit? 5. Calculate the total current liabilities, total long-term liabilities, and total liabilities of a classified balance sheet for Transit Airlines at December 31,2024 . Transit's accounts payable and accruals were $55 million