On March 1,2016,Baker Services Issued a 5% Long-Term Notes Payable

question 4

Multiple Choice

On March 1,2016,Baker Services issued a 5% long-term notes payable for $21,000.It is payable over a 3-year term in $7,000 annual principal payments on March 1 of each year plus interest,beginning March 1,2017.How will the notes payable be shown on the balance sheet dated December 31,2016?

• A)$21,000 shown as current liability only
• B)$7,000 shown as current liability and $21,000 shown as long-term liability
• C)$7,000 shown as current liability and $14,000 shown as long-term liability
• D)the entire $21,000 shown as long-term liability

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Definitions:

Budgeting

The process of creating a plan to spend your money, allocating estimated revenues towards expenses, savings, and debt repayment.

Variable Overhead Rate Variance

The difference between the actual variable overhead incurred and the standard cost assigned to production, measured per unit.

Planning Budget

A forecast of revenue, expenses, and profit for a specific period of time, often used as a financial roadmap.

Customers Served

The number of clients or customers that a company has provided services or goods to within a specific period.