For businesses, keeping track of notes payable is a necessity. Some businesses also have lines of credit. There are a couple of considerations when classifying the line of credit as either non-current or current note payable.
Notes payable are written contracts noting that the borrower will repay the lender a set sum of money in a certain amount of time. If payments are due within the business year, they are considered current. If they are due after the current business year, they are considered non-current.
Line of credit
A line of credit is the maximum amount that a lender will loan to a person or business. The amount can be established by the company's credit and cash flow history. In certain instances a company may be required to provide collateral to receive a line of credit.
A line of credit works much a like a credit card. You might be approved for $500,000, but if you have only used $100,000 then you only pay on the borrowed sum.
A line of credit should be reported in your notes payable, but should be listed as non-current as it is not due to be paid in full within the business year.
If your line of credit has been revoked or canceled and is due to be paid within the year, it should be marked current in your notes payable.