Exercise 5-9 (Part Level Submission)

The current assets and current liabilities sections of the balance sheet of Swifty Company appear as follows.

SWIFTY COMPANY

BALANCE SHEET (PARTIAL)

DECEMBER 31, 2017

Cash$46,800Accounts payable$55,740Accounts receivable$94,800Notes payable68,130Less: Allowance for doubtful accounts7,66087,140$123,870Inventory166,770Prepaid expenses9,030$309,740

The following errors in the corporations accounting have been discovered:

1.January 2018 cash disbursements entered as of December 2017 included payments of accounts payable in the amount of $39,300, on which a cash discount of 2% was taken.2.The inventory included $29,980of merchandise that had been received at December 31 but for which no purchase invoices had been received or entered. Of this amount, $10,920had been received on consignment; the remainder was purchased f.o.b. destination, terms 2/10, n/30.3.Sales for the first four days in January 2018 in the amount of $28,340were entered in the sales journal as of December 31, 2017. Of these, $20,610were sales on account and the remainder were cash sales.4.Cash, not including cash sales, collected in January 2018 and entered as of December 31, 2017, totaled $36,304. Of this amount, $24,304was received on account after cash discounts of 2% had been deducted; the remainder represented the proceeds of a bank loan.

(a1)

Your answer is correct.Calculate the following adjusted balances.

Cash

$

Accounts Receivable

$

Inventory

$

Accounts Payable

$

Notes Payable

$

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Attempts: 2 of 3 used

(a2)

Restate the current assets and current liabilities sections of the balance sheet in accordance with good accounting practice. (Assume that both accounts receivable and accounts payable are recorded gross.)(List Current Assets in order of liquidity.)

SWIFTYCOMPANY

Balance Sheet (Partial)

December 31, 2017

For the Year Ended December 31, 2017

For the Quarter Ended December 31, 2017

Asset