Question

In: Accounting

Calculate total current assets and total current liabilities that would appear in the company’s year-end balance sheet.

The trial balance for K and J Nursery, Inc., listed the following account balances at December 31, 2018, the end of its fiscal year:

cash, $16,000

accounts receivable, $11,000

inventories, $25,000

equipment (net), $80,000

accounts payable, $14,000

wages payable, $9,000

interest payable, $1,000

note payable (due in 18 months), $30,000

common stock, $50,000

Calculate total current assets and total current liabilities that would appear in the company’s year-end balance sheet.

Solutions

Expert Solution

Current assets : Current assets are assets that can be converted to cash within a year or consumed within a year.

Current liabilities: Current liabilities are those liabilities that represent the company's debt. These are expected to be satisfied within a year by using current assets or by incurring new current liabilities.

Calculation of Current assets 

Current assets = Cash + Accounts receivables + Inventories

=$16,000 + $11,000 + $25,000

=$52,000

Calculation of Current liabilities

Current liabilities = Accounts payable + Wages payable + Interest payable

=$14,000 + $9,000 + $1,000

=$24,000

Because an equipment is a long-term asset, it is not considered a current liability because the due date is more than 12 months. The shareholder's equity is represented by common stock.

Therefore,Current asset and current liability of the firm is $52,000 and $24,000 respectively.

balaji rao answered 2 years ago
Next > < Previous

Related Solutions

The current assets and current liabilities sections of the balance sheet of Crane Company appear as...
The current assets and current liabilities sections of the balance sheet of Crane Company appear as follows. CRANE COMPANY BALANCE SHEET (PARTIAL) DECEMBER 31, 2020 Cash $ 41,300 Accounts payable $  58,430 Accounts receivable $96,300 Notes payable 63,280     Less: Allowance for doubtful accounts 7,840 88,460 $121,710 Inventory 169,820 Prepaid expenses 8,620 $308,200 The following errors in the corporation’s accounting have been discovered: 1. January 2021 cash disbursements entered as of December 2020 included payments of accounts payable in the amount of...
The current assets and current liabilities sections of the balance sheet of Marin Company appear as...
The current assets and current liabilities sections of the balance sheet of Marin Company appear as follows. MARIN COMPANY BALANCE SHEET (PARTIAL) DECEMBER 31, 2017 Cash $ 46,100 Accounts payable $  56,560 Accounts receivable $95,900 Notes payable 67,760     Less: Allowance for doubtful accounts 8,850 87,050 $124,320 Inventory 163,710 Prepaid expenses 9,840 $306,700 The following errors in the corporation’s accounting have been discovered: 1. January 2018 cash disbursements entered as of December 2017 included payments of accounts payable in the amount of...
Lansing Company’s 2016 income statement and selected balance sheet data (for current assets and current liabilities)...
Lansing Company’s 2016 income statement and selected balance sheet data (for current assets and current liabilities) at December 31, 2015 and 2016, follow.    LANSING COMPANY Income Statement For Year Ended December 31, 2016 Sales revenue $ 63,000 Expenses Cost of goods sold 19,000 Depreciation expense 5,000 Salaries expense 9,000 Rent expense 2,000 Insurance expense 1,900 Interest expense 1,900 Utilities expense 1,200 Net income $ 23,000 LANSING COMPANY Selected Balance Sheet Accounts At December 31 2016 2015 Accounts receivable $...
Lansing Company’s 2017 income statement and selected balance sheet data (for current assets and current liabilities)...
Lansing Company’s 2017 income statement and selected balance sheet data (for current assets and current liabilities) at December 31, 2016 and 2017, follow. LANSING COMPANY Income Statement For Year Ended December 31, 2017 Sales revenue $ 124,200 Expenses Cost of goods sold 51,000 Depreciation expense 16,500 Salaries expense 27,000 Rent expense 9,900 Insurance expense 4,700 Interest expense 4,500 Utilities expense 3,700 Net income $ 6,900 LANSING COMPANY Selected Balance Sheet Accounts At December 31 2017 2016 Accounts receivable $ 6,500...
Lansing Company’s 2017 income statement and selected balance sheet data (for current assets and current liabilities)...
Lansing Company’s 2017 income statement and selected balance sheet data (for current assets and current liabilities) at December 31, 2016 and 2017, follow. LANSING COMPANY Income Statement For Year Ended December 31, 2017 Sales revenue $ 97,200 Expenses Cost of goods sold 42,000 Depreciation expense 12,000 Salaries expense 18,000 Rent expense 9,000 Insurance expense 3,800 Interest expense 3,600 Utilities expense 2,800 Net income $ 6,000 LANSING COMPANY Selected Balance Sheet Accounts At December 31 2017 2016 Accounts receivable $ 5,600...
The classified balance sheet for a company reported current assets of $1,299,200, total liabilities of $805,540,...
The classified balance sheet for a company reported current assets of $1,299,200, total liabilities of $805,540, Common Stock of $1,060,000, and Retained Earnings of $136,260. The current ratio was 2. What is the total amount of noncurrent assets? a) $702,600 b)$649,600 c)$493,660 d)$102,940
If the balance sheet of a firm indicates that total assets exceed current liabilities plus shareholders'...
If the balance sheet of a firm indicates that total assets exceed current liabilities plus shareholders' equity, then the firm must have: a. no retained earnings. b. long-term debt. c. no accumulated depreciation. d. current assets. e. None of the above Corporations are referred to as public companies when their: a. shareholders have no tax liability. b. shares are held by the federal or state government. c. stock is publicly traded. d. products or services are available to the public....
Your firm has the following balance sheet statement items: total current liabilities of $805,000; total assets...
Your firm has the following balance sheet statement items: total current liabilities of $805,000; total assets of $2,886,875; net fixed assets of $1,842,823; and long-term debt of $200,000. What is the amount of the firm's total current assets?
A company’s Balance Sheet (in millions) Assets Liabilities & Equity Current $20 Net Fixed $80 Bonds...
A company’s Balance Sheet (in millions) Assets Liabilities & Equity Current $20 Net Fixed $80 Bonds ($1000 Par) 40 Preferred stocks ($100 Par) 20 Total $100 Common Stock ($1 par) 40 Total $100 The company's bonds have 15 years to mature, pay 12% coupon rate semi-annually and comparable bonds' YTM is 14%. The market price of the common stock is $3.25 per share. The most recent dividend on the common stock was $0.85. The company’s applicable tax rate is 30%....
A bank's balance sheet equates the value of total assets to the sum of total liabilities...
A bank's balance sheet equates the value of total assets to the sum of total liabilities and equity capital. (T/F) Negotiable certificates of deposit (CDs) do not have an active secondary market. (T/F) In a bankruptcy situation, the Federal Reserve acts as the liquidator of the bank. (T/F) International expansion for financial institutions coming from highly integrated countries maximizes the risk diversification. (T/F) The financial crisis of 2008, demonstrated that activities such as trading in financial futures and interest-rate swaps...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT