Purest Owes $1 Million That Is Due on February 28

question 75

Multiple Choice

Purest owes $1 million that is due on February 28.The company borrows $800,000 on February 25 (5-year note) and uses the proceeds to pay down the $1 million note and uses other cash to pay the balance.How much of the $1 million note is classified as long-term in the December 31 financial statements?

• A)$1,000,000.
• B)$0.
• C)$800,000.
• D)$200,000.

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Definitions:

Net Sales

The total revenue generated from sales after deducting returns, allowances, and discounts.