Question

Presented below is the ending balances of accounts for the Kansas Instruments Corporation at December 31,...

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

Account Title Debits Credits
Cash $ 35,000
Accounts receivable 160,000
Raw materials 39,000
Note receivable 115,000
Interest receivable 18,000
Interest payable $ 20,000
Marketable securities 47,000
Land 65,000
Buildings 1,600,000
Accumulated depreciation—buildings 635,000
Work in process 57,000
Finished goods 104,000
Equipment 330,000
Accumulated depreciation—equipment 145,000
Patent (net of amortization) 135,000
Prepaid rent (for the next two years) 75,000
Deferred revenue 51,000
Accounts payable 195,000
Note payable 550,000
Cash restricted for payment of note payable 95,000
Allowance for uncollectible accounts 28,000
Sales revenue 1,100,000
Cost of goods sold 465,000
Rent expense 43,000


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. (Amounts to be deducted should be indicated by a minus sign.)

Current assets:   
Total current assets
Current liabilities:
Total current liabilities
Working capital
Business   Accounting   
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Homework Answers

Answer #1
Computation of Current Asset
Cash $35,000.00
Account Recivable $160,000.00
Les: Allowance for Unclollectible Account -$28,000.00
Raw Matrial $39,000.00
Notes Receivable $115,000.00
Interest Receivable $18,000.00
Matrketable securities $47,000.00
Work in Process $57,000.00
Finished Goods $104,000.00
Prepaid Rent (75000/2) $37,500.00
Total Current Asset $584,500.00
Computation of Current Liabilities
Interest Payable $20,000.00
Deferred Revenue (51000/2) $25,500.00
Account Payable $195,000.00
Total Current Liabilities $240,500.00
Computation of Working Capital- Kansas Instruments
Total Current Asset $584,500.00
Less: Current Liabilities $240,500.00
Working Capital $344,000.00
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