Which of the following balance sheet items is most likely to be classified as current? A. Debt due and payable after the following year. B. Notes receivable from employee due in 18 months. C. Trade payab1es to suppliers due and payable after 15 months. D. Fifteen-year old equipment in use with a remaining life of one year. I thought A, assuming the following year is >1, but it might be a misinterpretation. Correct answer is C but not sure why something due in 15mths would be current? thx
C. Trade payables = current liabilities
I think the trick to this one is the definition of current being inside twelve months or within the business cycle if is greater than 12 months.