Terracotta, Inc. reported the following accounts and amounts (in millions) in it

Question

Terracotta, Inc. reported the following accounts and amounts (in millions) in its financial statements for the year ended November 30, 2013.

Accounts Payable $ 730

Accounts Receivable 630

Accumulated Amortization 460

Accumulated Depreciation 800

Allowance for Doubtful Accounts 20

Cash and Cash Equivalents 840

Equipment 5,055

Income Taxes Payable 20

Notes Payable (long-term) 1,600

Notes Payable (short-term) 20

Notes Receivable (long-term) 220

Prepaid Rent 280

Retained Earnings 7,030

Service Revenue 460

Short-term Investments 2,440

Software 615

Unearned Revenue 790

Prepare the current assets section of its balance sheet. The Allowance for Doubtful Accounts relates entirely to Accounts Receivable.

Explanation / Answer

Preparation of the current assets section of its balance sheet:

Current assets: Amount Amount  (in millions) Cash and Cash Equivalents 840 Accounts Receivable 630 Less: Allowance for Doubtful Accounts -20 Accounts Receivable - Net 610 Short-term Investments 2,440 Prepaid Rent 280 Total Current assets: 4,170

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