Question

ON 1 The Role of Accounting as an Information System Required: Prepare a classified balance sheet for Jackson Corporation at December 31, 2021, by properly classifying each of the accounts The following are the ending balances of accounts at December 31, 2021, for the Valley Pump Corporation. Account Title Debits Credits Cash $ 25,000 Accounts receivable 56,000 Inventory 81,000 Interest payable $ 10,000 Investment in equity securities 44,000 Land 120,000 Buildings 300,000 Accumulated depreciation-buildings 100,000 Equipment 75,000 Accumulated depreciation-equipment 25,000 Copyright (net) 12,000 Prepaid expenses (next 12 months) 32,000 Accounts payable 65,000 Deferred revenue (next 12 months) 20,000 Notes payable 250,000 Allowance for uncollectible accounts 5,000 Common stock 200,000 Retained earnings 70,000 Totals $745,000 $745,000 Additional Information: 1. The $120,000 balance in the land account consists of $100,000 for the cost of land where the plant and office buildings are located. The remaining $20,000 represents the cost of land being held for speculation. 2. The $44,000 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 $100,000 note due in six months and a $150,000 note due in three annual installments of $50,000 each, with the first payment due in August of 2022.

Answer 1

Jackson Corporation
Balance Sheet
At December 31, 2021
Assets
		Amount (in $)	Amount (in $)
Current assets:
Cash		25,000
Accounts receivable	Note 1	51,000
Marketable securities	Note 2	22,000
Inventories		81,000
Prepaid expenses		32,000
Total current assets			211,000
Investments:
Marketable securities	Note 2	22,000
Land		20,000
Total investments			42,000
Property, plant, and equipment:
Land		100,000
Buidings		300,000
Equipment		75,000
		475,000
Less: Accumulated Depreciation	Note 3	125,000
Net property, plant, and equipment			350,000
Intangible assets:
Copyright			12,000
Total assets			615,000
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable		65,000
Interest payable		10,000
Deferred revenues		20,000
Note payable		100,000
Current maturities of long-term debt		50,000
Total current liabilities			245,000
Long-term liabilities:
Note payable			100,000
Shareholders’ equity:
Common stock		200,000
Retained earnings		70,000
Total shareholders’ equity			270,000
Total liabilities and shareholders’ equity			615,000

Note 1:	Accounts Receivable (Net)= Accounts Receivable - Allowance for uncollectible account
		=56000-5000
		51000
Note 2:	Marketable securities
	=44,000 / 2
	22000
Note 3:	Accumulated Depreciation
	= Accumulated Dep- Building + Accumulated Dep- Equipment
	=100,000 + 25,000
	125000