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homework3-2007-key - BALANCE SHEET Rhonda Rancher has...

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1 BALANCE SHEET Rhonda Rancher has applied for a loan. Her banker, Larry Loanmaker, says the old balance sheet on file must be brought up to date before a loan will be considered. Rhonda spends the rest of the afternoon taking inventory and gathering other information. Complete the balance sheet on the attached pages using the information below compiled by Rhonda on February 15, 2007. Milo on hand 4200 cwt. @ $4.40 per cwt. Hay on hand 75 tons @ $50.00 per ton Growing wheat 280 acres @ $22.50 per acre Farm mortgage (due4/01/07) $14,000 principal $20,000 accrued interest balance after 4/01/07 payment $208,000 Buildings & improvements $48,000 Note payable on feeder cattle (all due 11/15/07) $34,000 Calves (to be sold in May 2007) 98 head @ $275 per head Feeder cattle (to be sold in 60 days) 138 head @ $575 per head Note payable at bank (all due 3/1/07) $52,000 Vehicles $15,500 Other machinery & equipment $80,500 Loan on beef cows (due 10/01/07) $9,000 principal, $3,900 accrued interest balance after 10/1/07 payment $38,000 Land (present market value) 1020 acres @ $560 per acre Beef breeding cows 106 head @ $650 per head Bulls 4 head @ $1,000 each Checking account balance $5,400 Account payable at Joe's Feed & Seed $4,200 Account receivable $1,600 Shop Equip. (welder, lathe, drill press, etc.) $2,000 Ford Motor Co. stock 200 shares @ $65 per share Other Information 1) Has paid in advance for $6,000 worth of feed in order to get a good price on it. The feed will be delivered in May, 2007. 2) Income and social security taxes on 2006 income (not yet paid) are estimated at $7,200. 3) Rhonda contributed $50,000 to get her business started. 4) Retained earnings since the beginning of the business equals $305,000.
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