[vel70]

Hi everyone,

I would like to have some help with the classified balance sheet.
The case is:

I have a corporation and the year-end is Dec.31,2008. I did some adjusting entries and then the adjusted trial balance. It balanced. I did Income statement and Statement of Shareholders' Equity and Balance Sheet. It balanced. But I have some difficulty with the Liability part of the Classified Balance Sheet - what to include in Current Liability and what in Long-Term Liability.I have this info:

Accounts Payable
Bank Loan Payable
Mortgage Payable
Salaries Payable
Unearned Revenue
Retained Earning by Dec.31,2008

The bank loan was secured on Oct.1,2008 in the amount of 40,000 at annual interest rate of 3%. The entire loan plus interest is due on Sept 30,2009.
The current portion of the mortgage is 20,000.

If you can give me an idea what I am doing wrong.

Thank you very much in advance. I really appreciate your help.

[rehmanvohra]

Current liabilities are obligations to be settled within the next 12 months, the rest are long term liabilities.

Analyze each transaction and you should get your answer. Retained earnings is part of the stockholders' equity.

You have not mentioned what you have done, hence the guidance.

[pready]

Your long-term liabilitites need to be sepearated between the current portion due and the long-term portion.

Current portion is what is due within the next 12 months or within the next business operating cycle.

[vel70]

Thank you very much for your answers.