Is bond payable a current liability?
Understand the Problem
The question is asking whether bonds payable are classified as current liabilities on a company's balance sheet, which relates to financial accounting and reporting.
Answer
No, Bond Payable is generally not a current liability
Bond Payable is generally not a current liability
Answer for screen readers
Bond Payable is generally not a current liability
More Information
Bonds payable are usually classified as long-term liabilities since they are typically due more than one year in the future. However, any portion of the bond that is due within the next 12 months would be classified as a current liability.
Tips
A common mistake is to classify the entirety of the bond payable as a current liability without considering the time frame.
Sources
- Current Liabilities vs. Long-Term Liabilities - investopedia.com
- What Are Bonds in Financial Terms? - investopedia.com
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