Problem 1: Included in the December 31 trial balance of Billie Joel Company are the following assets.
Cash 190,000
Equipment (net) 1,100,000
Work in process 200,000
Receivable (net) 400,000
Prepaid insurance 41,000
Patents 110,000
Raw material 335,000
Finished Goods 150,000
Prepare the current assets section of the December 31 balance sheet.
Problem 2: Castlevania Corporation purchased a truck at the beginning of 2007 for $42,000. The truck is estimated to have a salvage value of $2,000 and a useful life of 160,000 miles. It was driven 23,000 miles in 2007 and 31,000 miles in 2008. Compute depreciation expense for 2007 and 2008.
Problem 3: Bonanza Brothers Inc. purchased land at a price of $27,000. Closing costs were $1,400. An old building was removed at a cost of $12,200. What amount should be recorded as the cost of the land?