Harvey Corporation has the following accounts included in its December 31, 2019 trial balance: Accounts Receivable $110,000, Inventory $290,000, Allowance for Doubtful Accounts $8000, Patents $72,000, Prepaid Insurance $9500, Accounts payable $77000. How much should be reported in the current assets section of the balance sheet

Question

Savannah Cross

Business

1 September, 04:31

Harvey Corporation has the following accounts included in its December 31, 2019 trial balance: Accounts Receivable $110,000, Inventory $290,000, Allowance for Doubtful Accounts $8000, Patents $72,000, Prepaid Insurance $9500, Accounts payable $77000. How much should be reported in the current assets section of the balance sheet

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Answers (1)

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Moody · Answer 1

The correct answer is $401,500.

Explanation:

According to the scenario, the computation of the given data are as follows:

We can calculate the total current assets by using following formula:

Total current Assets = Account Receivable - Allowance for Doubtful Accounts + inventory + Prepaid insurance

By putting the following value, we get

Total current assets = $110,000 - $8,000 + $290,000 + $9,500

= $401,500