Question

Note Payable (due Nov 1, 20X2) $ 2,000 Retained Earnings (Jan. 1, 20X1) $ 3,900 Revenues 55,600 Supplies 700 Supplies Expense 6,600 Cash 6,900 Insurance Expense 800 Prepaid Advertising 1,200 Depreciation Expense 100 Rent Expense 6,900 Common Stock (Jan. 1, 20X1) 18,000 Accounts Receivable 19,500 Unearned Revenues 11,500 Accounts Payable 1,600 Equipment 15,000 Accumulated Depreciation 2,000 Cost of goods sold 27,000 Inventory 8,000 Allowance for Doubtful Accounts 600 Discount on Note Payable 500 The owner of the company made an additional investment of $2,000 in the business during the year in exchange for common stock and dividends of $4,000 were declared and paid. The Unearned Revenues represent a prepayment received from a customer and 80% of these services will be completed by December 31, 20X2. Determine the Total Current Liabilities at December 31, 20X1: $

Answer 1

Answer:

Total current liabilities      13,800

Explanation:

Current Liabilities:

Obligation to pay or do within a year.

We are on Dec 31th 20X2 so anything due on Dec 31th 20X3 or before this date, will be current.

Note payable                   2,000 (due nov 1, 20X2)

Discount on NP                  (500)

Note payable net              1, 500

Unearned Revenues         9,200

(80% of the 11,500 will be provided during the  year)

Account Payable                1,600

Total current liabilities      13,800

the allowance for doubtful account is a contra-asset account not a liability account.

The equity is not part of the current liabilities.

the dividends were declared and paid, so there is no dividend payable.