Question

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 53 Account Title Cash Accounts receivable Inventory Interest payable Investment in equity securities Land Buildings Accumulated depreciation-buildings Equipment Accumulated depreciation equipment Copyright (net) Prepaid expenses (next 12 months) Accounts payable Deferred revenue (next 12 months) Notes payable Allowance for uncollectible accounts Common stock Retained earnings Totals Debits Credits $ 26,000 58,000 83,000 $ 11,000 46,000 122,000 305,000 101,000 77,000 26,000 13,000 33,000 66,000 21,000 255,000 6,000 210,000 67,000 $763,000 $763,000 Additional Information: 1. The $122,000 balance in the land account consists of $101,000 for the cost of land where the plant and office buildings are located The remaining $21,000 represents the cost of land being held for speculation 2. The $46,000 balance in the investment in equity securities account represents an investment in the common stock of another corporation. Valley intends to sell one-half of the stock within the next year. 3. The notes payable account consists of a $102,000 note due in six months and a $153,000 note due in three annual installments of $51,000 each with the first payment due in August of 2022

Answer 1

Valley Pump Corporation
Balance Sheet At
December 31,2021
Assets
current assets
Cash		$ 26000
Investment in equity Securities [ 46000 *1/2]		$ 23000
Accounts Receivable	$ 58000
allowance for uncollectible accounts	(6000)
Accounts Receivable net of allowance		$ 52000
Inventories		$ 83000
Prepaid Expenses		$ 33000
Total Current Assets		$ 217000
Investments
Investment in equity Securities		$ 23000
Land		$ 21000
Total Investments		$ 44000
Fixed Assets
Land	$101000
Building	$ 305000
Equipment	$ 77000
Less: Accumulated Depreciation - buildings	(101000)
Less: Accumulated Depreciation - equipment	(26000)
Net Fixed Assets		$ 356000
Intangible Assets
Copyright(Net of amortization)		$ 13000
Total Assets		$ 630,000
Liabilities & Stockholder's Equity
Current Liabilities
Accounts Payable	$ 66000
Deferred Revenue	$ 21000
Notes Payable	$ 102000
Interest Payable	$ 11000
Current Maturity of Long term deb	$ 51000
Total Current Liabilities		$ 251000
Long term libailities:
Long Term notes Payable		$ 102000
Total Liabilities		$ 353,000
Common Stock		$ 210,000
Retained Earnings		$ 67000
Total Stock holder's Equity		$ 277,000
Total Liabilities and stockholder's equity		$ 630,000