On November 1,2012,EZ Products borrowed $48,000 on a 5%,10-year note with annual installment payments of $4,800 plus interest due on November 1 of each succeeding year.
-On November 1,the principal amount was initially recorded as Long-term notes payable,and then a second entry was made to reclassify the current portion.Which of the following is the proper reclassification entry?
A)

\begin{array} { | l | r | r | } \hline \text { Long-term notes payable } & 4,800 & \\\hline \text { Current portion of long-term notes payable } & & 4,800 \\\hline\end{array}

\begin{array} { | l | r | r | } \hline \text { Current portion of long-term notes payable } & 4,800 & \\\hline \text { Accounts payable } & & 4,800 \\\hline\end{array}

\begin{array} { | l | r | r | } \hline \text { Long-term notes payable } & 4,800 & \\\hline \text { Accounts payable } & & 4,800 \\\hline\end{array}

\begin{array} { | l | r | r | } \hline \text { Current portion of long-term notes payable } & 4,800 & \\\hline \text { Long-term notes payable } & & 4,800 \\\hline\end{array}

Blanding Company Issues $1,000,000 of 8%,10-Year Bonds at 98 on February

Multiple Choice

Correct Answer:VerifiedUnlock this answer nowGet Access to more Verified Answers free of chargeAccess For Free

Correct Answer:
Verified
Unlock this answer now
Get Access to more Verified Answers free of charge