Chapter 3, Problem 3.6E

Balance sheet; Current versus long-term classification

• LO3–2, LO3–3

Presented next are the ending balances of accounts for the Kansas Instruments Corporation at December 31, 2018.

Account Title	Debits	Credits
Cash $	20,000
Accounts receivable	130,000
Raw materials	24,000
Note receivable	100,000
Interest receivable	3,000
Interest payable		$ 5,000
Marketable securities	32,000
Land	50,000
Buildings	1,300,000
Accumulated depreciation—buildings		620,000
Work in process	42,000
Finished goods	89,000
Equipment	300,000
Accumulated depreciation—equipment		30,000
Patent (net of amortization)	120,000
Prepaid rent (for the next two years)	60,000
Deferred revenue (next 12 months)		36,000
Accounts payable		180,000
Note payable		400,000
Cash restricted for payment of note payable	80,000
Allowance for uncollectible accounts		13,000
Sales revenue		800,000
Cost of goods sold	450,000
Rent expense	28,000

Additional Information:

1. The note receivable, along with any accrued interest, is due on November 22, 2019.

2. The note payable is due in 2022. Interest is payable annually.

3. The marketable securities consist of treasury bills, all of which mature in the next year.

4. Deferred revenue will be recognized as revenue equally over the next two years.

Required:

Determine the company’s working capital (current assets minus current liabilities) at December 31, 2018.