Sonar Company prepared a draft of its 2014 balance sheet.The draft statement reported total assets of $437,500.Included in this total assets figure were the following items: At which amount should Sonar' total assets be correctly reported in the December 31,2014,balance sheet?
A) $420,850
B) $421,300
C) $425,050
D) $425,500

Question

Sonar Company prepared a draft of its 2014 balance sheet.The draft statement reported total assets of $437,500.Included in this total assets figure were the following items:  At which amount should Sonar' total assets be correctly reported in the December 31,2014,balance sheet?
A) $420,850 
B) $421,300 
C) $425,050 
D) $425,500

Quizplus · Accepted Answer

The correct total amount of assets can be calculated as follows:
$437,500 (draft balance sheet figure) - $4,500 (accumulated depreciation of equipment) - $4,500 (accumulated depreciation of buildings) + $4,000 (prepaid real estate taxes) - $1,000 (long-term note payable due in one year) = $425,500. Therefore, the correct total assets amount for Sonar Company's December 31, 2014 balance sheet is $425,500. The best choice is D.

Sonar Company Prepared a Draft of Its 2014 Balance Sheet