Question

The following trial balance of Reese Corp. at December 31, 2020 has been properly adjusted except for the income tax expense adjustment. Reese Corp. Trial Balance December 31, 2020 Dr. Cr. Cash $ 875000 Accounts receivable (net) 2695000 Inventory 2085000 Property, plant, and equipment (net) 8269000 Accounts payable and accrued liabilities $ 1761000 Income taxes payable 654000 Deferred income tax liability 85000 Common stock 2350000 Additional paid-in capital 3680000 Retained earnings, 1/1/20 3490000 Net sales and other revenues 13560000 Costs and expenses 11180000 Income tax expenses 476000 $25580000 $25580000 Included in accounts receivable is $1200000 due from a customer and payable in quarterly installments of $150000. The last payment is due December 29, 2022. In Reese's December 31, 2020 balance sheet, The current assets total is:

Answer 1

Answer: $50,55,000

Explanation:

Cash = $875,000

Accounts receivable = $2,695,000

Quarterly installments = $150,000 × 4 = $600,000

Inventory = $2,085,000

The current assets:

= Cash + [Accounts receivable - (quarterly installments)] + Inventory

=  $875,000 + [$2,695,000 - ($150,000 × 4)] + $2,085,000

= $50,55,000

Therefore, the total current assets of a company is $50,55,000.