USA: +1(669)289-8683 
Sign in
(Balance Sheet Classifications)
Presented below are a number of balance sheet accounts of Cunningham, Inc.
For each of the accounts below, indicate the proper balance sheet classification.
|
(a) |
||
|
(b) |
Treasury Stock |
|
|
(c) |
Common Stock |
|
|
(d) |
Cash Dividends Payable |
|
|
(e) |
Accumulated Depreciation |
|
|
(f) |
Warehouse in Process of Construction (for use by this company) |
|
|
(g) |
Petty Cash |
|
|
(h) |
Accrued Interest on Notes Payable |
|
|
(i) |
Deficit |
|
|
(j) |
Trading Securities |
|
|
(k) |
Income Taxes Payable |
|
|
(l) |
Unearned Subscription Revenue |
|
|
(m) |
Work in Process |
|
|
(n) |
Accrued Vacation Pay |
(Classification of Balance Sheet Accounts)
Presented below are the captions of Nikos Company’s balance sheet.
|
Current assets . |
(f) |
Current liabilities. |
|
|
Investments. |
(g) |
Non-current liabilities. |
|
|
(c) |
Property, plant, and equipment . |
Capital stock. |
|
|
Intangible assets . |
Additional paid-in capital . |
||
|
(e) |
Other assets. |
(j) |
Retained earnings . |
Indicate by letter where each of the following items would be classified.
|
1. |
Preferred stock. |
|
2. |
Goodwill . |
|
3. |
Wages payable . |
|
4. |
Trade accounts payable. |
|
5. |
Buildings. |
|
6. |
Trading securities. |
|
7. |
Current portion of long-term debt. |
|
8. |
Premium on bonds payable . |
|
9. |
Allowance for doubtful accounts. |
|
10. |
Accounts receivable . |
|
11. |
Cash surrender value of life insurance . |
|
12. |
Notes payable (due next year) . |
|
13. |
Office supplies . |
|
14. |
Common stock . |
|
15. |
Land . |
|
16. |
Bond sinking fund. |
|
17. |
Merchandise inventory. |
|
18. |
Prepaid insurance . |
|
19. |
Bonds payable . |
|
20. |
Taxes payable. |
(Preparation of a Corrected Balance Sheet)
Presented below and on the next page is the balance sheet of Kishwaukee Corporation as of December 31, 2012.
KISHWAUKEE CORPORATION
Balance Sheet
December 31, 2012
Assets
Goodwill (Note 2)
$121,700
Buildings (Note 1)
1,640,000
Inventories
312,100
950,000
1
71,700
Treasury stock (50,000 shares, no par)
88,700
Cash on hand
177,600
Assets allocated to trustee for plant expansion
Cash in bank
U.S. Treasury notes, at cost and fair value
139,700
$3,673,200
Equities
Notes payable (Note 3)
$601,700
Common stock, authorized and issued, 1,000,000 shares, no par
1,151,700
859,700
Appreciation capital (Note 1)
571,700
Federal income taxes payable
76,700
Reserve for depreciation recorded to date on the building
411,700
$3,673,200
Note 1: Buildings are stated at cost, except for one building that was recorded at appraised value. The excess of appraisal value over cost was $571,700. Depreciation has been recorded based on cost.
Note 2: Goodwill in the amount of $121,700 was recognized because the company believed that book value was not an accurate representation of the fair market value of the company. The gain of $121,700 was credited to Retained Earnings.
Note 3: Notes payable are long-term except for the current installment due of $
100,000
.
Prepare a corrected classified balance sheet in good form. The notes above are for information only.
(List current assets in order of liquidity and current liabilities and long-term investments from largest to smallest amount, e.g. 10, 5, 3.)
|
Balance Sheet |
|||||||||||||||||||||
|
Current assets |
|||||||||||||||||||||
|
$ |
|||||||||||||||||||||
|
Total current assets |
|||||||||||||||||||||
|
Long-term investments |
|||||||||||||||||||||
|
Assets allocated to trustee for expansion |
|||||||||||||||||||||
Property, plant and equipment
$
Less:
$
Liabilities and Stockholders’ Equity
Current liabilities
$
Total current liabilities
$
Long-term liabilities
Total liabilities
Stockholders’ equity
Total stockholders’ equity
Total liabilities and stockholders’ equity
$
(Preparation of a Statement of Cash Flows and Balance Sheet)
Aero Inc. had the following balance sheet at the end of operations for 2011.
AERO INC.
Balance Sheet
December 31, 2011
$23,510
Accounts payable
$33,510
Accounts receivable
24,710
44,510
Trading securities
32,000
Capital stock
103,510
Plant assets (net)
84,510
Retained earnings
26,710
Land
43,510
$208,240
$208,240
During 2012 the following occurred.
1. Aero liquidated its investment portfolio at a loss of $8,510.
2. A tract of land was purchased for $41,510.
3. An additional $30,000 in common stock was issued at par.
4. Dividends totaling $13,510 were declared and paid to stockholders.
5. Net income for 2012 was $38,510, including $15,510 in depreciation expense.
6. Land was purchased through the issuance of $33,510 in additional bonds.
7. At December 31, 2012, Cash was $73,710, Accounts Receivable was $45,510, and Accounts Payable was $43,510.
Prepare a statement of cash flows for the year 2012 for Aero.
(List multiple entries from the largest positive to the smallest positive amount followed by the most negative to the least negative amount, e.g. 15, 14, 10, -17, -5, -1. For negative numbers use either a negative sign preceding the number, e.g. -45 or parenthesis, e.g. (45).)
AERO INC.
Statement of Cash Flows
For the Year Ended December 31, 2012
Cash flows from operating activities
$
Adjustments to reconcile net income to net cash
provided by operating activities
$
Net cash provided by operating activities
Cash flows from investing activities
Net cash used by investing activities
Cash flows from financing activities
Net cash provided by financing activities
Net increase in cash
Cash at beginning of year
Cash at end of year
$
Noncash investing and financing activities
Land purchased through issuance of $ of bonds
|
Complete the balance sheet as it would appear at December 31, 2012. AERO INC. Balance Sheet December 31, 2012 Assets Liabilities and Stockholders’ Equity Cash $ Accounts payable $ Accounts receivable Bonds payable Plant assets (net) | Common stock |
|
Compute Aero’s free cash flow for 2012. Free Cash Flow Analysis $ Less: Free cash flow $ |
(Preparation of a Corrected Balance Sheet)
Bruno Company has decided to expand its operations. The bookkeeper recently completed the balance sheet presented below in order to obtain additional funds for expansion.
|
BRUNO COMPANY |
||
|
December 30, 2012 |
||
| Cash |
$232,170 |
|
|
Accounts receivable (net) |
325,170 |
|
|
Inventories at lower of average cost or market |
401,000 |
|
|
Trading securities-at cost (fair value $120,000) |
140,000 |
|
|
Property, plant, and equipment |
||
|
Building (net) |
574,760 |
|
|
Office equipment (net) |
160,000 |
|
|
Land held for future use |
179,760 |
|
|
Intangible assets |
||
| Goodwill |
80,000 |
|
| Cash surrender value of life insurance |
90,000 |
|
|
Prepaid expenses |
12,000 |
|
|
Current liabilities |
||
|
109,760 |
||
| Notes payable (due next year) |
127,170 |
|
|
Pension obligation |
82,000 |
|
|
Rent payable |
51,170 |
|
| Premium on bonds payable |
53,000 |
|
|
504,760 |
||
|
Common stock, $1.00 par, authorized |
||
|
400,000 shares, issued 290,000 |
290,000 | |
| Additional paid-in capital | ||
|
? |
Prepare a revised balance sheet given the available information. Assume that the accumulated depreciation balance for the buildings is $160,000 and for the office equipment, $105,000. The allowance for doubtful accounts has a balance of $
17,000
. The pension obligation is considered a long-term liability.
(List current assets in order of liquidity. List multiple entries for Property, plant and equipment, Long-term investments and Current liabilities from largest to smallest amounts, e.g. 10, 5, 2.)
| Current assets | |
| Property, plant, and equipment | |
| Intangible assets | |
|
Total assets |
Long-term liabilities |
|
Add: |
Stockholders’ equity |
|
Common stock, $1 par, authorized |
|
|
400,000 shares, issued 290,000 shares |
|
|
Total stockholders’ equity |
(Balance Sheet Preparation)
Presented below is the adjusted trial balance of Abbey Corporation at December 31, 2012.
|
Debits |
Credits |
|||
|
$ ? |
||||
| Office supplies |
3,930 |
|||
| Prepaid insurance |
3,730 |
|||
|
Equipment |
50,730 |
|||
|
Accumulated depreciation-Equipment |
$4,000 |
|||
|
Trademarks |
1,440 |
|||
|
12,730 |
||||
| Wages payable |
500 |
|||
|
Unearned service revenue |
2,490 |
|||
|
Bonds payable, due 2017 |
11,730 |
|||
|
25,000 |
||||
|
Service revenue |
10,000 |
|||
|
Wages expense |
9,000 |
|||
|
Insurance expense |
1,400 |
|||
|
Rent expense |
1,200 |
|||
|
Interest expense |
900 |
|||
| Total | $ ? |
Additional information:
1. Net loss for the year was $2,500.
2. No dividends were declared during 2012.
Prepare a classified balance sheet as of December 31, 2012.
(List current assets in order of liquidity. List multiple entries for current liabilities from largest to smallest amounts, e.g. 10, 5, 3.)
|
ABBEY CORPORATION |
(Preparation of a Statement of Cash Flows)
The comparative balance sheets of Connecticut Inc. at the beginning and the end of the year 2012 appear below.
|
CONNECTICUT INC. |
|||
|
Balance Sheets |
|||
|
Dec. 31, 2012 |
Jan. 1, 2012 |
Inc./Dec. |
|
|
$46,370 |
$13,000 |
$33,370 Inc. |
|
|
94,730 |
90,360 |
4,370 Inc. |
|
|
42,730 |
24,360 |
18,370 Inc. |
|
|
Less: Accumulated depreciation |
(20,730) |
(11,000) |
9,730 Inc. |
|
$163,100 |
$116,720 |
||
|
$23,730 |
$17,360 |
6,370 Inc. |
|
| 100,000 |
82,360 |
17,640 Inc. |
|
|
39,370 |
17,000 |
22,370 Inc. |
|
| $163,100 | $116,720 |
Net income of $37,730 was reported, and dividends of $15,360 were paid in 2012. New equipment was purchased and none was sold.
Prepare a statement of cash flows for the year 2012.
(List multiple entries from the largest positive to the smallest positive amount followed by the most negative to the least negative amount, e.g. 15, 14, 10, -17, -5, -1. For negative numbers use either a negative sign preceding the number, e.g. -45 or parenthesis, e.g. (45).)
|
Adjustments to reconcile net income to net cash provided |
|
by operating activities: |
|
Net cash used by financing activities |
