Answer:
$6 million of outstanding bonds that mature in 2025, but which are currently callable by bondholders. However, because current market interest rates are much higher than the coupon rate on the bonds, the bondholders are not expected exercise the call option.
NON-CURRENT LIABILITY $6,000,000
the bonds are not expected to be called this year
A $2 million mortgage on its manufacturing building, which is due in June of 2019. However, on January 28th, before the issuance of 2018 financial statements, Oldman refinanced this mortgage by making a down payment of $400k and taking out a new mortgage for $1.6 million.
CURRENT LIABILITY $400,000
NON-CURRENT LIABILITY $1,600,000
the debt was refinanced, so most of it will not be due this year
A $1.2 million note payable from the company’s bank which is due on March 31, 2019. The note is secured by the company’s inventory and accounts receivable. The company expects to refinance this note, but has not yet started the process to do so.
CURRENT LIABILITY $1,200,000
since the refinance process has not started, you must consider this a current liability
