You have been asked to review the December 31, 2016, balance sheet for Champion

Question

You have been asked to review the December 31, 2016, balance sheet for Champion Cleaning. After completing your review, you list the following three items for discussion with your superior: An investment of $31,000 is included in current assets. Management has indicated that it has no intention of liquidating the investment in 2017. A $110,000 note payable is listed as a long-term liability, but you have determined that the note is due in 10, equal annual installments with the first installment due on March 31,2017. Deferred revenue of $63,000 is included as a current liability even though only two-thirds will be earned in 2017, and the other one-third in 2018. Determine the appropriate amount and classification for each of these items. (If not entry is required for classification, choose "No entry".)

Explanation / Answer

Current Non Current Items Classification Amount Classification Amount 1.Investments Non Current Assets $31,000 2.Installmet Note Cuurent Liability $$11,000 Non Current Liability $99,000 3.Deferred revenue Current $42,000 Non Current $21,000

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