On the balance sheet the current portion of long-term debt should:
A) be paid immediately.
B) be reclassified as a current liability.
C) be classified as a long-term liability.
D) not be separated from the long-term portion of debt.

Question

Quizplus · Accepted Answer

The current portion of long-term debt represents the portion of the long-term debt that is due within the next 12 months. As a result, it should be classified as a current liability on the balance sheet. This is because it represents an obligation that must be paid in the near term, and is therefore more relevant to the company's short-term liquidity position.

On the Balance Sheet the Current Portion of Long-Term Debt