Problem $10\mathrm{.}8$A As at $31$ December of the current year, Norman Company has prepared the following information regarding its liabilities and other obligations $($dollar amounts are in thousands$)$:

Notes payable, of which $\backslash (\backslash$$ $10,000\backslash )$ will be repaid within the next $12$ months.

Interest expense that will result from existing liabilities over the next $12$ months

Lawsuit pending against the company, in which $\backslash (\backslash$$ $500,000\backslash )$

is claimed in damages. Legal counsel can make no reasonable

estimate of the company's ultimate liability at this time $......................500,000$

$20-$year bond issue that matures in two years. The entire

amount will be repaid from a bond sinking fund $.............................900,000$

Accrued interest on the $20-$year bond issue as at the end of reporting period.

Three$-$year commitment to John Lau as chief financial

officer at a salary of $\backslash (\backslash$$ $250,000\backslash )$ per year

Note payable due within $90$ days $($but that is expected to be extended for an additional $18$ months$)$

Cash deposits from customers for goods and services to be delivered over the next nine months

Income taxes, of which $\backslash (\backslash$$ $100,000\backslash )$ are currently payable and the remainder deferred indefinitely

$\backslash$$ $80,000$

$125,000$

Instructions

a$.$ Prepare a listing of the company's current and noncurrent liabilities as they should be presented in the company's $31$ December statement of financial position.

b$.$ Briefly explain why you have excluded any of the listed items in your listing of current and noncurrent liabilities.