Question

In the event that a short-term obligation is refinanced on a long-term basis prior to the issuance of the financial statements, how much of the short-term obligation can be excluded from current liabilities in the financial statements?

Answer 1

Answer:

The total amount that is refinanced on a long term basis can be excluded from current liabilities on the financial statements.

Explanation:

Short term liabilities can be excluded from current liabilities if the company is able to refinance them on a long term basis. Even if the company has not finished the refinancing procedures, they can still exclude them from the current liabilities as long as they can prove that they are going to be able con consummate the refinancing.