Question

Current Portion of Long-Term Debt

Connie's Bistro, Inc., reported the following information about its long-term debt in the notes to a recent financial statement:

Long-term debt is comprised of the following:

	December 31
	Current Year		Preceding Year
Total long term-debt	$377,900		$207,800
Less current portion	(109,600)		(102,000)
Long-term debt	$268,300		$105,800

a. How much of the long-term debt was disclosed as a current liability on the current year’s December 31 balance sheet?
$

b. How much did the total current liabilities change between the preceding year and the current year as a result of the current portion of long-term debt?
$ Increase

c. If Connie's Bistro did not issue additional long-term debt next year, what would be the total long-term debt on December 31 of the upcoming year?
$

Answer 1

Solution a:

Long-term debt disclosed as a current liability on the current year’s December 31 balance sheet = Current portion of Long term debt = $109,600

Solution b:

Change in Total current liabilities between the preceding year and the current year = $109,600 - $102,000 = $7,600

Solution c:

Current portion of Long Teram debt will be paid in upcoming year i.e. 109,600

Therefoer, Total long-term debt on December 31 of the upcoming year = Total Long Term Debt Current year - Current portion of long term debt which will be paid off in upcoming year = $377900 - 109600 = $268,300