Solution Manual For Financial Accounting 11th Edition Robert Libby, Patricia Libby, Complete Chapters 1 - 13, Verified Newest Version

West Corp. had the following liabilities by the end of 2013: Accounts Payable $60,000 Wages Payable $70,000 Unearned Revenue $100,000 (80% will be earned in 2014) Notes Payable $140,000 ($30,000 payable in 2014) What is the amount that West Corp. should report as Total Current Liability on its balance sheet as of December 31, 2013? {Ans: The correct answer is $240,000. The Total Current Liability reported would be the sum of Accounts Payable, Wages Payable, $80,000 of Unearned Revenue, and $30,000 of Notes Payable. 60,000 + 70,000 + 80,000 + 30,000 = $240,000}Suppose Company Z lent $100,000 to Company A on January 1, 2012. On December 31, 2013, Company A paid back the $100,000 and also paid $12,000 interest to Company Z. Under U.S.GAAP, what would be the impact of the transaction on Company Z's statement of cash flows of 2013 using the direct method? {Ans: The $100,000 would be shown as an increase in the funds in the Investing Section but the $12,000 would be shown as an increase in the Operating Section.}Company A estimates that it needs 30% of sales in net working capital. In year 1, sales were $1 million and in year 2, sales