Current assets for two different companies at fiscal year-end 2017 are listed here. One is a manufacturer, Rayzer Skis Mfg., and the other, Sunrise 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 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 7,000 . . . . . . . . . . . . . $ 5,000
Raw materials inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . - . . . . . . . . . . . . . 42,000
Merchandise inventory . . . . . . . . . . . . . . . . . . . . . . . . . . 45,000 . . . . . . . . . . . . . . . . -
Work in process inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . - . . . . . . . . . . . . . 30,000
Finished goods inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . - . . . . . . . . . . . . . 50,000
Accounts receivable, net . . . . . . . . . . . . . . . . . . . . . . . . . 62,000 . . . . . . . . . . . . . 75,000
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,500 . . . . . . . . . . . . . . . .900