Bake Co.'s trial balance included the following at December 31, 20X1:
Accounts payable $ 80,000
Bonds payable, due 20X2 300,000
Discount on bonds payable 15,000
Deferred income tax liability 25,000
The deferred income tax liability is not related to an asset for financial accounting purposes and is expected to reverse in 20X2. What amount should be included in the current liability section of Bake's December 31, 20X1, balance sheet (statement of financial position)?
A.
$365,000 – my answer
B.
$390,000 – correct answer
C.
$395,000
D.
$420,000
Can someone explain why 365k is incorrect? With the simplification method and ASU 2015-07, deferred income taxes should be reported as non-current. Unless I'm mistaken?
-Turbo
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