Howell Company Has the Following Selected Accounts After Posting Adjusting

question 36

Essay

Howell Company has the following selected accounts after posting adjusting entries: $\begin{array}{lr}\text { Accounts Payable } & 55,000 \\\text { Notes Payable, 3-month } & 70,000 \\\text { Accumulated Depreciation-Equipment } & 14,000 \\\text { FICA Taxes Payable } & 27,000 \\\text { Notes Payable, 5-year, 8\% } & 30,000 \\\text { Warranty Liability } & 34,000 \\\text { Payroll Tax Expense } & 6,000 \\\text { Interest Payable } & 3,000 \\\text { Mortgage Payable } & 200,000 \\\text { Sales Taxes Payable } & 16,000\end{array}$ Instructions
Prepare the current liability section of Howell Company's balance sheet, assuming $25,000 of the mortgage is payable next year. (List liabilities in magnitude order, with largest first.)

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Definitions:

Rent Control Ceiling

A legal maximum price that can be charged for rental housing, intended to keep housing affordable for tenants.

Effective Immediately

A term indicating that something is to be applied or become operative from the moment it is declared.

Price Ceiling

A legal maximum price that can be charged for a good or service, intended to protect consumers from price gouging.

Equilibrium Price

The price at which the quantity of a good supplied equals the quantity demanded, resulting in market equilibrium.