Problem 2-15 Balance Sheet (LG2-1) Brenda\'s Bar and Grill has total assets of $

Question

Problem 2-15 Balance Sheet (LG2-1) Brenda's Bar and Grill has total assets of $29.0 million, of which $23.0 million are current assets, Cash makes up 10 percent of the current assets and accounts receivable makes up another 40 percent of current assets. Brenda's gross plant and equipment has a book value of $21.5 million and other long-term assets have a book value of $400,000. What is the balance of inventory and the balance of depreciation on Brenda's Bar and Grill's balance sheet? (Enter your answers in millions of dollars rounded to 1 decimal place.)

Explanation / Answer

Answer Problem 2-15 -   

Total current assets = Cash + Account Receivable + Inventory

23 million = .10 of 23 + .40 of 23 + Inventory

Inventory = 11.5 million

Balance of Depreciation = Non current Assets - Plant and equipment - other long term assets

= 6 million - 21.5 million - .4 million

= 15.9 million

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