A company has a \$300,000 loan with a 6-year term and annual repayments of \$50,000. How would this be reported on the balance sheet at the end of the second year?

• A. \$300,000 as current liabilities.
• B. \$250,000 as long-term liabilities.
• C. \$50,000 as current liabilities and \$200,000 as long-term liabilities.
• D. \$0 as liabilities since the loan is not due yet.

Answer: (C)