Included in Sauder Corp

question 86

Multiple Choice

Included in Sauder Corp.'s liability account balances at December 31, 2006, were the following: 7% note payable issued October 1, 2006, maturing September 30, 2007 $250,000
8% note payable issued April 1, 2006, payable in six equal annual
Installments of $150,000 beginning April 1, 2007 600,000
Sauder 's December 31, 2006 financial statements were issued on March 31, 2007.On January 15, 2007, the entire $600,000 balance of the 8% note was refinanced by issuance of a long-term obligation payable in a lump sum.In addition, on March 10, 2007, Sauder consummated a noncancelable agreement with the lender to refinance the 7%, $250,000 note on a long-term basis, on readily determinable terms that have not yet been implemented.On the December 31, 2006 balance sheet, the amount of the notes payable that Sauder should classify as short-term obligations is

• A)$175,000.
• B)$125,000.
• C)$50,000.
• D)$0.

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