The adjusted trial balance for Lifesaver Corp. at the end of the current year, 2

Question

The adjusted trial balance for Lifesaver Corp. at the end of the current year, 2014, contained the following accounts.
5-year Bonds Payable 8% $2,500,000

Interest Payable 50,000

Premium on Bonds Payable 100,000

Notes Payable (3 months.) 40,000

Notes Payable (5 yr.) 165,000

Mortgage Payable ($15,000 due currently) 200,000

Salaries and wages Payable 18,000

Income Taxes Payable (due 3/15 of 2015) 25,000

The total long-term liabilities reported on the balance sheet are

A) $2,865,000. B) $2,850,000. C) $2,965,000. D) $2,950,000.

Explanation / Answer

Answer

* Long Term Liabilities are those Liabilities that are to be repaid in longer period of time and are not due to be repaid in short run.

Answer and working

5 Year Bonds Payable $                             2,500,000.00 Notes Payable (5 Year) $                                 165,000.00 Mortgage Payable [200000 - 15000] $                                 185,000.00 Total Long Term Liabilities reported on Balance Sheet $                             2,850,000.00 Correct Answer Option 'B' $ 2,850,000

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