Question

The following December 31, 2021, fiscal year-end account balance information is available for the Stonebridge Corporation: Cash and cash equivalents $ 5,400 Accounts receivable (net) 24,000 Inventory 64,000 Property, plant, and equipment (net) 140,000 Accounts payable 43,000 Salaries payable 15,000 Paid-in capital 120,000 The only asset not listed is short-term investments. The only liabilities not listed are $34,000 notes payable due in two years and related accrued interest of $1,000 due in four months. The current ratio at year-end is 1.7:1. Required: Determine the following at December 31, 2021:Total current assets

Answer 1

Current Asset = 100,300

Explanation: $

Current Asset

Inventory 64,000

Accounts Receivables 24,000

Short Term Investment

Cash and Cash Equivalent 5,400

93,400 + X

Current Liabilities

Accounts Payable 43,000

Salaries Payable 15,000

Accrued Interest 1000

59,000

Current Ratio = Current Asset ÷ Current Liability

1.7 = 93400+X

1 59000

X+ 93400= 59000×1.7

X= 100300-93400

X = $6,900 ( Short Term Investments)

Current Asset= 93400+6900= 100,300