On December 31, 20X5, Gold Charter Airlines Has $2,000,000 in Short-Term

Multiple Choice

On December 31, 20X5, Gold Charter Airlines has $2,000,000 in short-term notes payable due on February 10, 20X6. On January 10, 20X6, Gold arranged a line of credit with Fargo Wells Bank, which allows Gold to borrow up to $1,500,000 at 1% above the prime rate for three years. On February 2, 20X6, Gold borrowed $1,200,000 from Fargo Wells Bank and used $500,000 additional cash to liquidate $1,700,000 of the short-term notes payable. What is the amount of the short-term notes payable that should be reported as current liabilities on Gold's December 31, 20X5 statement of financial position (to be issued on Feb 28, 20X5) is

A) $0
B) $300,000
C) $2,000,000
D) $1,200,000