funds to borrow. In case of borrowings with high amounts, companies prefer longer maturities, so that it is expected to be easier to pay the loan back and protect the liquidity of company at the same time. Companies pay these loans in installments, which include some part of principal and accrued interest together. Therefore, even long-term borrowings have repayment obligations in short term. In other words, some part of the long-term loan matures within one year (or operating cycle length) as of balance sheet date. This part to be paid in the next financial statement term is classified as Current Portion of Long Term Loan. The correct answer is B.