Flynn Manufacturing produces snowboards which it sells to pro shops in ski resor
ID: 2540601 • Letter: F
Question
Flynn Manufacturing produces snowboards which it sells to pro shops in ski resorts and other retailers. Flynn’s sales and purchases are all on account. Coal’s year-end balance sheet reports total current assets of $402,000, cash of $135,000, accounts payable of $15,000, accounts receivable of $157,500, prepaid expenses of $13,500, finished goods inventory of $60,000, and work in process inventory of $17,100. What amount is reported on Coal’s year-end balance sheet for raw materials inventory?
Cannot be determined from the information provided.
A) Cannot be determined from the information provided.
B) $33,900
C) $18,900
D) $3,900
Explanation / Answer
Answer
The Correct Answer is Option - C $18900
NOte that Raw Material inventory forms part of the current assets. Given total of current asset = $402000
However, when cash, accounts receivable, prepaid expenses, finished goods inventory, work in process inventory are added, they onlyarrive at $383100 [135000+157500+13500+60000+17100]
Hence, amount of raw material inventory will be $402000 - $383100 = $18900.