Mcgraw hillirwin melody lane music company balance

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McGraw-Hill/Irwin Problem 03-10 MELODY LANE MUSIC COMPANY Balance Sheet At December 31, 2013 Assets Current assets: Cash $167,000 Inventories 100,000 Prepaid rent 3,000 Total current assets 270,000 Property, plant and equipment: Equipment and furniture $40,000 Less: Accumulated depreciation (4,000) Net property, plant, and equipment 36,000 Total assets $306,000 Correct! Liabilities and Shareholders' Equity Current liabilities: Accounts payable $21,000 Interest payable 9,000 Loan payable 100,000 Total current liabilities 130,000 Shareholders' equity: Common stock, no par, 100,000 shares authorized 20,000 shares issued and outstanding $100,000 Retained earnings 76,000 Total shareholders' equity 176,000 Total liabilities and shareholders' equity $306,000 Correct!
Given Data P03-10: MELODY LANE MUSIC COMPANY Cash receipts: From customers $360,000 From issue of common stock 100,000 From bank loan 100,000 Cash disbursements: Purchase of inventory $300,000 Rent 15,000 Salaries 30,000 Utilities 5,000 Insurance 3,000 Purchase of equipment and furniture 40,000 Interest rate on one-year bank loan dated March 31, 2013 12% Furniture and equipment purchased January 3, 2013: Useful life (years) 10 Depreciation per year $4,000 Salvage value $- Inventories on hand at end of year $100,000 Amounts owed 12/31/2013: To suppliers of inventory $20,000 To the utility company $1,000 Building rent per month $1,000 Months of rent paid in advance 4 Net income for year $76,000 Shares of no par common stock authorized 100,000 Shares of common stock issued and outstanding 20,000

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