Howell Company has the following selected accounts after posting adjusting entries:
|
Accounts Payable
|
$ 45,000
|
|
Notes Payable, 3-month
|
80,000
|
|
Accumulated Depreciation-Equipment
|
14,000
|
|
Payroll and Benefits Payable
|
27,000
|
|
Notes Payable, 5-year, 8%
|
30,000
|
|
Estimated Warranty Liability
|
34,000
|
|
Payroll Tax Expense
|
6,000
|
|
Interest Payable
|
3,000
|
|
Mortgage Payable
|
200,000
|
|
Sales Tax Payable
|
16,000
|
Instructions
1. Prepare the current liability section of Howell Company's balance sheet, assuming $25,000 of the mortgage is payable next year. (List liabilities in magnitude order, with largest first.)
2. Comment on Howell's liquidity, assuming total current assets are $450,000.