Question

These items are taken from the financial statements of Ivanhoe Company at December 31, 2022 Buildings Accounts receivable Prepaid insurance Cash Equipment Land Insurance expense Depreciation expense Interest expense Common stock Retained earnings (January 1, 2022) Accumulated depreciation-buildings Accounts payable Notes payable Accumulated depreciation equipment Interest payable Service revenue $90,988 10,836 2,752 10,182 70,864 52,632 671 4,558 2236 51,600 34,400 39,216 8.170 80,496 16,099 3,096 12642 Prepare a classified balance sheet. Assume that $11.696 of the note payable will be paid in 2023. (List Current Assets in order of liquidity and Property, Plant and Equipment in order of Land, Buildings and Equipment)

Answer 1

Solution:

IVANHOE COMPANY Balance sheet December 31 ,2022 Assets Current assets: Cash 10,182 Accounts receivable Prepaid Insurance 10,836 2,752 Total current assets 23,770 Non-Current Assets Land 52,632 Building 90,988 Less: Accumulated depreciation-Building 39,216 51,772 Equipment 70,864 Less: Accumulated depreciation-Equipmemt 16,099 54,765 Total assets 182,939 Liabilities and Stockholders' Equity Current liabilities: Notes Payable 11,696 Acconts payable 8,170 Interest payable Total current liabilities Long-Term Liabilities: Notes payable Total Liabilities Stockholders' Equity 3,096 22,962 68,800 91,762 Common Stock 51,600 Retained Earnings 39,577 Total Stockholders' Equity 91,177 Total Liabilities and Stockholders' Equity 182,939 %24 %24

Workings: Retained Earnings = $34,400 + 12,642 -671 - 4,558 - 2,236 = $39,557

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