Question

Your answer is partially correct. The following information is available for Marigold Bowling Alley at December 31, 2022. $129,000 14,460 4,800 $100,000 5,290 42,480 18,240 13,200 Buildings Accounts Receivable Prepaid Insurance Cash Equipment Land Insurance Expense Depreciation Expense Interest Expense Share Capital Retained Earnings (beginning) Accumulated Depreciation-Buildings Accounts Payable Notes Payable Accumulated Depreciation-Equipment Interest Payable Bowling Revenues 61,400 55,000 780 97,620 18,420 2,150 14,160 7,490 2,150 Prepare a classified statement of financial position. Assume that $14,200 of the notes payable will be paid in 2023. (List Current Assets in reverse order of liquidity. List Property, Plant and Equipment in order of Land, Buildings and Equipment.)

Answer 1

First, we have to calculate net income

Bowling revenues		$   14,160
Less: Expenses
Insurance expense	$      780
Depreciation expense	$   7,490
Interest expense	$   2,150
Total expenses		$   10,420
Net income		$     3,740

Marigold Bowling Alley
Balance Sheet
As at December 31, 2022
Assets
Cash		$     18,240
Accounts Receivables		$     14,460
Prepaid insurance		$       4,800
Total current assets			$     37,500
Property, Plant and Equipment
Land		$     55,000
Equipment	$     61,400
Accumulated depreciation - Equipment	$ (18,420)	$     42,980
Building	$   129,000
Accumulated depreciation - Building	$   (42,480)	$     86,520
Total property, plant and equipment			$   184,500
Total Assets			$   222,000
Liabilities
Current Liabilities
Accounts payable		$     13,200
Interest payable		$       2,150
Notes payable		$     14,200
Total current liabilities			$     29,550
Non-current liabilities
Note payable ($97,620-14,200)			$     83,420
Total liabilities			$   112,970
Owners' equity
Share capital		$   100,000
Retained earnings ($5,290+3,740)		$       9,030
Total Shareholders' equity			$   109,030
Total liabilities and shareholders' equity			$   222,000

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