Current assets for two different companies at calendar year end 2011 are listed here. One is a manufacturer, Roller Blades Mfg., and the other, Sunny Foods, is a grocery distribution company. (1) Identify which set of numbers relates to the manufacturer and which to the merchandiser. (2) Prepare the current asset section for each company from this information. Discuss why the current asset section for these two companies is different.
|
Account |
Company 1 |
Company 2 |
|
Cash |
$ 9,000 |
$ 7,000 |
|
Raw materials inventory |
— |
44,000 |
|
Merchandise inventory |
47,000 |
— |
|
Goods in process inventory |
— |
32,000 |
|
Finished goods inventory |
— |
52,000 |
|
Accounts receivable, net |
64,000 |
77,000 |
|
Prepaid expenses |
3,500 |
700 |