Exercise 5-7 Presented below are selected accounts of Yasunari Kawabata Company

Question

Exercise 5-7

Presented below are selected accounts of Yasunari Kawabata Company at December 31, 2014.

The following additional information is available.

Prepare the current assets section of Yasunari Kawabata Company’s December 31, 2014, balance sheet, with appropriate disclosures. (List Current Assets in order of liquidity. Enter account name only and do not provide the descriptive information provided in the question.)

Inventory (finished goods) $ 52,000 Cost of Goods Sold $2,100,000 Unearned Service Revenue 90,000 Notes Receivable 40,000 Equipment 253,000 Accounts Receivable 161,000 Inventory (work in process) 34,000 Inventory (raw materials) 207,000 Cash 37,000 Supplies Expense 60,000 Equity Investments (short-term) 31,000 Allowance for Doubtful Accounts 12,000 Customer Advances 36,000 Licenses 18,000 Restricted Cash for Plant Expansion 50,000 Additional Paid-in Capital 88,000 Treasury Stock 22,000

Explanation / Answer

Assets Current Assets Cash $37,000 Accounts receivable $1,61,000 Less: Allowance for Doubtful Accounts $12,000 $1,49,000 Notes Receivable $40,000 Inventory (Finished Goods) $52,000 Inventory (Work in Process) $34,000 Inventory (Raw Material) $2,07,000     Total Current Assets $5,19,000

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