Problem: The current assets and current liabilities sections of the balance sheet of Ivanhoe Company appear as follows.
IVANHOE COMPANY BALANCE SHEET (PARTIAL) DECEMBER 31, 2017
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Cash
|
|
$40,100
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Accounts payable
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$59,850
|
|
Accounts receivable
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$89,200
|
|
Notes payable
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60,600
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|
Less: Allowance for doubtful accounts
|
8,330
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80,870
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$120,450
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Inventory
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161,250
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|
|
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Prepaid expenses
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|
9,400
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|
|
|
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$291,620
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|
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The following errors in the corporation's accounting have been discovered:
1. January 2018 cash disbursements entered as of December 2017 included payments of accounts payable in the amount of $41,500, on which a cash discount of 2% was taken.
2. The inventory included $31,670 of merchandise that had been received at December 31 but for which no purchase invoices had been received or entered. Of this amount, $12,240 had 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 $30,970 were entered in the sales journal as of December 31, 2017. Of these, $19,780 were 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 $36,598. Of this amount, $24,598 was received on account after cash discounts of 2% had been deducted; the remainder represented the proceeds of a bank loan.
Required: Calculate the following adjusted balances.
- Cash
- Accounts receivable
- Inventory
- Accounts Payable
- Notes Payable.
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