Riley Company borrowed $22,000 on April 1, Year 1 from Titan Bank. The note issued by Riley carried a one-year term and a 8% annual interest rate. Riley earned cash revenues of $880 during Year 1 and $900 during Year 2. Assume no other transactions.Based on this information alone, what are the amounts of total liabilities that would appear on Riley's December 31 balance sheets for Year 1 and Year 2, respectively?
A. $22,000 and $0
B. $23,320 and $23,780
C. $1320 and $460
D. $23,320 and $0
Answer: D
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