Question

The following incomplete balance sheet for the Sanderson Manufacturing Company was prepared by the company's controller. As accounting manager for Sanderson, you are attempting to reconstruct and revise the balance sheet. $ 2,750 6,500 (1,900) 7,500 2,700 17,550 SANDERSON MANUFACTURING COMPANY Balance Sheet At December 31, 2021 ($ in 000s) Assets Current assets: Cash Accounts receivable Allowance for uncollectible accounts Finished goods inventory Prepaid expenses Total current assets Long-term assets: Investments Raw materials and work in process inventory Equipment Accumulated depreciation Patent (net) Total assets Liabilities and Shareholders' Equity Current liabilities: Accounts payable Notes payable Interest payable (on notes) Deferred revenue Total current liabilities Long-term liabilities: Bonds payable Interest pavable lon bonds) 4,500 3,750 24,000 (5,700) 2 $ ? $ 6,700 7,000 1,600 6,000 21,300 7,000 500

Answer 1

Sanderson Manufacturing Company Balance sheet As at 31.12.2021 ($ in 000's except share data) Assets Current Assets Cash Short-term investments Accounts receivable, net of allowance 2750 4500 4600 Inventories Raw materials and work in process Finished goods 3750 7500 11250 2700 25800 Prepaid expenses Total current assets Property, plant, and equipment Equipment Accumulated depreciation Net property, plant, and equipment Intangible assets Patent Total assets 24000 -5700 18300 8700 52800 6700 Liabilities and Shareholders' Equity Current liabilities Accounts payable Interest payable Deferred revenue Current maturities of long-term debt Total current liabilities 2100 3000 1750 13550 13550 3000 5250 7000 15250 28800 Long-term liabilities Deferred revenue Note payable Bonds payable Total liabilities Shareholders' equity Common stock Retained earnings Total shareholders' equity Total liabilities and shareholders' equity 15000 9000 24000 52800 Solve for missing amounts: Liabilities + Equity = 1.2 $28,800 = Equity = 1.2 Equity = $28,800 = 1.2 = $24,000 Beginning retained earnings + Net income - Dividends = Ending retained earnings $7,000 + 2,300 - 300 = $9,000 Total equity - Retained earnings = Common stock $24,000 - 9,000 = $15,000 Assets = Liabilities + Equity Assets = $28,800 + 24,000 = $52,800 $52,800 - All other assets = Patent $52,800 - 44,100 = $8,700 Accounts receivable, net of $1,900 allowance for uncollectible accounts = $4,600. Common stock, no par, 600,000 shares authorized, 400,000 shares issued and outstanding = $15,000.