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ash ccounts receivable lerchandise inventory eferred charges $ 2,000,000 3,000,00 1,900,00 100,00

ash ccounts receivable lerchandise inventory eferred charges $ 2,000,000 3,000,00 1,900,00 100,00

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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The current sections of the unadjusted balance sheet of Canex Company on December 31, 2020 were as follows: Current Assets Current Liabilities Cash $ 2,000,000 Trade accounts payable, Accounts receivable 3,000,000 1,900,000 net of a debit balance Merchandise inventory of $50,000 $ 2,450,000 Deferred charges 100,000 Interest payable 150,000 Income tax payable Money claims of union, pending 300,000 final decision 500,000 Mortgage payable, due in four annual installment 2,000,000 Total current assets $ 7,000,000 Total current liabilities $ 5,400,000 A review of the accounts showed that the cash balance of $2,000,000 included a customer's check amounting to $100,000 returned by the bank marked NSF, an employee's IOU of $50,000, and the amount of $200,000 deposited with the court for a case under litigation. The cash in bank portion of $1,650,000 is the balance per bank statement. On December 31, 2020, outstanding checks amounted to $250,000. Accounts receivable balance of $3,000,000 is composed of. $ 1,600,000 400,000 200,000 300,000 Customers' debit balances Advances to subsidiary Advances to suppliers Receivable from officers Allowance for doubtful accounts (100,000) Selling price of merchandise invoiced at 120% of cost, not yet delivered and excluded from ending inventory 600,000 $ 3,000,000
Transcribed Image Text:The current sections of the unadjusted balance sheet of Canex Company on December 31, 2020 were as follows: Current Assets Current Liabilities Cash $ 2,000,000 Trade accounts payable, Accounts receivable 3,000,000 1,900,000 net of a debit balance Merchandise inventory of $50,000 $ 2,450,000 Deferred charges 100,000 Interest payable 150,000 Income tax payable Money claims of union, pending 300,000 final decision 500,000 Mortgage payable, due in four annual installment 2,000,000 Total current assets $ 7,000,000 Total current liabilities $ 5,400,000 A review of the accounts showed that the cash balance of $2,000,000 included a customer's check amounting to $100,000 returned by the bank marked NSF, an employee's IOU of $50,000, and the amount of $200,000 deposited with the court for a case under litigation. The cash in bank portion of $1,650,000 is the balance per bank statement. On December 31, 2020, outstanding checks amounted to $250,000. Accounts receivable balance of $3,000,000 is composed of. $ 1,600,000 400,000 200,000 300,000 Customers' debit balances Advances to subsidiary Advances to suppliers Receivable from officers Allowance for doubtful accounts (100,000) Selling price of merchandise invoiced at 120% of cost, not yet delivered and excluded from ending inventory 600,000 $ 3,000,000
Required: 1. Compute for the correct total of current assets on December 31, 2020. 2. Compute for the correct total of current liabilities on December 31, 2020.
Transcribed Image Text:Required: 1. Compute for the correct total of current assets on December 31, 2020. 2. Compute for the correct total of current liabilities on December 31, 2020.
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