Tumbling Haven, a gymnastic equipment manufacturer, provided the following information to its accountant. The company had current assets of $145,332, net fixed assets of $356,190, and other assets of $4,176. The firm had long-term debt of $76,445, common stock of $200,000, and retained earnings of $134,461. What amount of current liabilities did this firm have?

Question

Quizplus · Accepted Answer

We can use the equation:
Total Assets = Total Liabilities + Equity
to find the amount of current liabilities.
Total Assets = Current assets + Net fixed assets + Other assets = $145,332 + $356,190 + $4,176 = $505,698
Total Liabilities + Equity = Long-term debt + Common stock + Retained earnings = $76,445 + $200,000 + $134,461 = $410,906
Therefore,
Current liabilities = Total liabilities and equity - Total assets
Current liabilities = $410,906 - $505,698 = $94,792. 
So the answer is A.

Tumbling Haven, a Gymnastic Equipment Manufacturer, Provided the Following Information