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The following is a December 31, 2018, post-closing trial balance for Almway Corporation.
| Account Title | Debits | Credits | ||
| Cash | 45,000 | |||
| Investments | 110,000 | |||
| Accounts receivable | 60,000 | |||
| Inventories | 200,000 | |||
| Prepaid insurance (for the next 9 months) | 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:
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.
The land account includes land which cost $25,000 that the company has not used and is currently listed for sale.
The cash account includes $15,000 restricted in a fund to pay bonds payable that mature in 2021 and $23,000 restricted in a three-month Treasury bill.
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, 2019.
The $60,000 balance in accounts receivable is net of an allowance for uncollectible accounts of $8,000.
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, 2018. (Amounts to be deducted should be indicated by a minus sign.)
Expert Answer
| Balance sheet | ||
| Assets | ||
| Current assets | ||
| Cash | 30000 | |
| Short term investment | 80000 | |
| Accounts receivable net of allowance | 60000 | |
| Inventories | 200000 | |
| Prepaid insurance | 9000 | |
| Total current assets | 379000 | |
| Investment | ||
| Marketable securities | 30000 | |
| Land held for sale | 25000 | |
| Restricted cash | 15000 | |
| Total investment | 70000 | |
| Plant property and equipment | ||
| Land | 65000 | |
| Building | 420000 | |
| Accumulated depreciation building | -100000 | |
| Equipment | 110000 | |
| Accumulated depreciation equipment | -60000 | |
| Net property plant and equipment | 435000 | |
| Intangible assets | ||
| Patents | 10000 | |
| Total assets | 894000 | |
| Liabilities and stockholders equity | ||
| Liabilities | ||
| Current liability | ||
| Accounts payable | 75000 | |
| Interest payable | 20000 | |
| Notes payable | 30000 | |
| Current maturities of long term debt | 10000 | |
| Total current liabilities | 135000 | |
| Long term liabilities | ||
| Notes payable | 90000 | |
| Bonds payable | 240000 | |
| Total long term liabilities | 330000 | |
| Shareholdres equity | ||
| Authorized 500000 shares | ||
| Issued and outstanding shares | 300000 | |
| Retained earings | 129000 | |
| Total shareholders equity | 429000 | |
| Total liabilities and shareholders equity | 894000 | |
