Ques: For Intermediate Acccounting 15th Edition, CH-5, Problem E5-7 (or 7E), ple
ID: 2470904 • Letter: Q
Question
Ques: For Intermediate Acccounting 15th Edition, CH-5, Problem E5-7 (or 7E), please advise how to compute the Inventory Section, Cash and Notes Receivable Section of the Current Assets. Thanks. Here is the COMPLETE question per your request:
E5-7 (Current Assets Section of the Balance Sheet) Presented below are selected accounts of Yasunari Kawabata Company at December 31, 2014. Finished Goods $52,000 Cost of Goods Sold $2,100,000 Unearned Revenue 90,000 Notes Receivable 40,000 Equipment 253,000 Accounts Receivable 161,000 Work in Process 34,000 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 Cash Restricted for Plant Expansion 50,000 Additional Paid-in Capital 88,000 Treasury Stock 22,000 The following additional information is available: 1. Inventories are valued at lower-of-cost-or-market using LIFO. 2. Equipment is recorded at cost. Accumulated depreciation, computed on a straight-line basis, is $50,600 3. The short-term investments have a fair value of $29,000 (Assume they are trading securities.) 4. The notes receivables are due April 30, 2016, with interest receivable every April 30. The notes bear interest at 6% (Hint: Accrue interest due on December 31, 2014.) 5. The allowance for doubtful accounts applies to the accounts receivable. Accounts receivable of $50,000 are pledged as collateral on a bank loan. 6. Licenses are recorded net of accumulated amortization of $14,000 7. Treasury stock is recorded at cost. Instructions: Prepare the current assets section of Yasunari Kawabata Company’s December 31, 2014, balance sheet, with appropriate disclosures.Explanation / Answer
Assets : Current Assets Inventory: Finished Goods 52,000 Work In Process 34,000 Raw Material 207,000 293,000 Cash 37,000 Short Term Equity 29,000 Account Receivable 161,000 Allowance for Doubt ful Debts 12,000 149,000 Notes Recievable 40,000 Total Current Assets 548,000