Question

Check my work 3 Exercise 3-5 (Algo) Balance sheet preparation [LO3-2, 3-3] The following are the ending balances of accounts at December 31, 2021, for the Valley Pump Corporation. 10 points Account Title Cash Debits Credite $ 34,000 Accounts receivable 74,000 99,000 Inventory Interest payable $ 19,000 Book 62,000 Investnent in equity securities Land 138,000 345,000 Buildings Print Accumulated depreciation-buildings Equi pment Accumulated deprecintion equipment Copyright (net) Prepaid expenses (next 12 montha) Accounts payable 109,000 93,000 34,000 21,000 Retarances 41,000 24,000 Deferred revenue (next 12 montha) Notes payable Allowance for uncollectible accounta 29,000 295,000 9,000 290,000 48,000 $907,000 Common stook Retained carnings $907,000 Totals Additional Information: 1. The $138,000 balance in the land account consists of $109,000 for the cost of land where the plant and office buildings are located. The remaining $29,000 represents the cost of land being held for speculation. 2. The $62,000 balance in the investment in equity securities account represents an investment in the common stock of another corporation. Valley intends to sell ane-half of the stock within the next year. 3. The notes payable account consists of a $118,000 note due in six months and a $177,000 note due in three annual installments of $59,000 each, with the first payment due in August of 2022. Required: Prepare a classified balance sheet for the Valley Pump Corporation at December 31, 2021. Use the additional information to help determine appropriate classifications and account balances. (Amounts to be deducted should be indicated by a minus sign.) KALLE Y DU conn oDATION

Answer 1

VALLEY PUMP CORPORATION BALANCE SHEET At December 31, 2021 Assets Current Assets : $34,000 $65,000 $ 99,000 $ 31,000 $ 41,000 $270,000 Cash Accounts Receivable (net) Inventories Investment in qui securities Prepaid expenses Total current assets. Investments : Equity Investment in na 1 securities Land Total investments Property, plant and equipment: Land Buildings Equipment $31,000 $ 29,000 $ 60,000 $ 109,000 $345,000 $ 93,000 $547,000 $ 143,000 $ 404,000 A Less: Accumulated Depreciation Net Property, plant and Equipment Intangible Assets: Copyright Total Assets $21,000 1$755,000

liabilities and Shareholders Equity Current Liabilities: Accounts Payable 1$ 74,000 Deferred Revenues $ 29,000 Notes Payable $ 118,000 Interest Payable $ 19,000 Current maturities of long term debt $ 59,000 Total current liabilities $299,000 Long term liabilities: Notes Payable $ 118,000 Shareholders' equity : Common stock $ 290,000 Retained Earnings $ 48,000 Total Shareholders' Equity $ 338,000 Total liabilities and shareholders' equity $ 755,000 Calculation: Accounts Receivable, net = accounts Receivable - Allowance for uncollectible accounti = $ 74,000 - $9,000 z $ 65,000 Investment in equity securities = $62,000 x I - $31,000 Accumulated Depreciation = Building Depreciation & Equipment Depreciatian - $109,000 + $ 34,000 = $143,000