Exercise 5-7 Presented below are selected accounts of Carla Company at December 31, 2017. Cost of Goods Sold Inventory (finished goods) Unearned Service Revenue Notes Receivable Accounts Receivable Equipment Inventory (work in process) Cash (not including restricted cash) Debt Investments (trading) Customer Advances $ 57,100 99,000 259,100 41,700 42,600 32,700 42,900 50,800 Inventory (raw materials) Supplies Expense Allowance for Doubtful Accounts $2,105,600 37,200 164,180 195,590 64,430 11,240 17,770 86,610 23,020 Licenses Restricted Cash for Plant Expansion Additional Paid-in Capital Treasury Stock The following additional information is available. 1. Inventories are valued at lower-of-cost-or-market using LIFO. 2. Equipment is recorded at cost. Accumulated depreciation, computed on a straight-line basis, is $50,080. 3. The short-term investments have a fair value of $30,750. 4. The notes receivable are due April 30, 2019, with interest receivable every April 30. The notes bear interest at 6%. (Hint: Accrued interest due on December 31, 2017.) 5. The allowance for doubtful accounts applies to the accounts receivable. Accounts receivable of $52,700 are pledged as collateral on a bank loan. 6. Licenses are recorded net of accumulated amortization of $13,410. 7. Treasury stock is recorded at cost. CARLA COMPANY Balance Sheet (Partial) $ $ $