2013 FAR AICPA newly issued question

The question below was issued by the AICPA for 2013, below is the pdf link to download the file, but unfortunately there is no explanation.

https://www.becker.com/accounting/cpaexamreview/students/2013_AICPA_FAR_MCQs.pdf

Could someone explain the correct answer below? As in why “C” is the correct answer? Any help will be appreciated!

As of December 1, year 2 a company obtained a $1,000,000 line of credit maturing in one year on which it has drawn $250,000, a $750,000 secured note due in five annual installments, and a $300,000 three-year balloon note. The company has no other liabilities. How should the company’s debt be presented in its classified balance sheet on December 31, year 2 if no debt repayments were made in December?

a. Current liabilities of $1,000,000; long-term liabilities of $1,050,000.

b. Current liabilities of $500,000; long-term liabilities of $1,550,000.

c. Current liabilities of $400,000; long-term liabilities of $900,000.

d. Current liabilities of $500,000; long-term liabilities of $800,000.

Thanks!!