Difficulty 3 hard learning objective 0303 identify

This preview shows page 7 - 11 out of 13 pages.

Difficulty: 3 Hard Learning Objective: 03­03 Identify and describe the two balance sheet liability classifications. eBook & Resources References
41. Award: 10.00 points Problems? Adjust credit for all students. The following is a December 31, 2016, post­closing trial balance for Almway Corporation. Account Title Debits Credits Cash 45,000 Investments 110,000 Accounts receivable 60,000 Inventories 200,000 Prepaid insurance 9,000 Land 90,000 Buildings 420,000 Accumulated depreciation—buildings 100,000 Equipment 110,000 Accumulated depreciation— equipment 60,000 Patents (net of amortization) 10,000 Accounts payable 75,000 Notes payable 130,000 Interest payable 20,000 Bonds Payable 240,000 Common stock 300,000 Retained earnings 129,000 Totals 1,054,000 1,054,000 Additional information: 1. The investment account includes an investment in common stock of another corporation of $30,000 which management intends to hold for at least three years. The balance of these investments is intended to be sold in the coming year. 2. The land account includes land which cost $25,000 that the company has not used and is currently listed for sale. 3. The cash account includes $15,000 restricted in a fund to pay bonds payable that mature in 2019 and $23,000 set aside in a three­month Treasury bill. 4. The notes payable account consists of the following: a. a $30,000 note due in six months. b. a $50,000 note due in six years. c. a $50,000 note due in five annual installments of $10,000 each, with the next installment due February 15, 2017. 5. The $60,000 balance in accounts receivable is net of an allowance for uncollectible accounts of $8,000. 6. The common stock account represents 100,000 shares of no par value common stock issued and outstanding. The corporation has 500,000 shares authorized. Required: Prepare a classified balance sheet for the Almway Corporation at December 31, 2016. (Amounts to be deducted should be indicated by a minus sign.)
$ $ $ $ $ Prepaid insurance 9,000 Total current assets 379,000 Investments Marketable securities 30,000 Land held for sale 25,000 Restricted cash 15,000 Total investments 70,000 Property, plant, and equipment Land 65,000 Buildings 420,000 Equipment 110,000 595,000 Accumulated depreciation (160,000) Net property, plant, and equipment 435,000 Intangible assets

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture