On December 31, 2010, Irey Co

Multiple Choice

On December 31, 2010, Irey Co.has $2,000,000 of short-term notes payable due on February 14, 2011.On January 10, 2011, Irey arranged a line of credit with County Bank which allows Irey to borrow up to $1,500,000 at one percent above the prime rate for three years.On February 2, 2011, Irey borrowed $1,200,000 from County Bank and used $500,000 additional cash to liquidate $1,700,000 of the short-term notes payable.The amount of the short-term notes payable that should be reported as current liabilities on the December 31, 2010 statement of financial position which is issued on March 5, 2011 is

A) $0.
B) $300,000.
C) $500,000.
D) $800,000.