USE THE FOLLOWING INFORMATION TO ANSWER THE NEXT (6)
QUESTIONS:
The following is a December 31, 2018, post-closing trial balance
for Desert Company:
Account Title | Debits | Credits |
Cash | $ 83,000 | |
Accounts Receivable (net of Allowance) | $256,000 | |
Prepaid Expenses | $ 32,000 | |
Investments | $ 65,000 | |
Land | $175,000 | |
Buildings (net) | $160,000 | |
Equipment (net) | $145,000 | |
Accounts Payable | $ 73,000 | |
Accrued Expenses | $ 45,000 | |
Unearned Revenue | $150,000 | |
Notes Payable | $300,000 | |
Common Stock | $200,000 | |
Retained Earnings | $148,000 | |
TOTALS | $916,000 | $916,000 |
Additional Information:
1. The cash account includes $10,000 set aside in a legally
restricted fund to pay bonds payable that mature in 2024 and a
$13,000 cash surrender value of a life insurance policy on the
company's CEO.
2. The accounts receivable balance consists of the following:
Amounts owed by customers with debit balances | $213,000 |
Customer accounts with credit balances | 12,000 |
Allowance for Uncollectible Accounts - trade customers | (15,000) |
Non-trade note receivable due in three years | 60,000 |
Interest receivable on note due in four months | 10,000 |
TOTAL | $256,000 |
3. The land account includes land which cost $75,000 that the
company purchased for speculative purposes and is currently held
for sale. The remaining $100,000 is the cost of land on which the
company's office building resides. The equipment account includes
idle machinery with a book value of $25,000.
4. The investments account is classified as Available for Sale Securities and includes an investment of $25,000 in bonds that mature July 1, 2019. Of the remaining investments balance, management intends to hold for at least the next three years. All investments in the portfolio have already been marked-to-market and are reported at Fair Value.
5. The unearned revenue represents customer prepayments for
magazine subscriptions. Subscriptions are for three years and will
be earned evenly over each of the years beginning January 1,
2019.
6. The notes payable account consists of the following:
a. a $50,000
note due in six months.
b. a
$100,000 bond due in six years.
c. a
$150,000 note due in three annual installments of $50,000 each,
with the next installment due Nov. 1, 2019.
*Interest on
all notes has been properly accrued and is included in accrued
expenses.
Required:
(1) Using this information, determine the
amount of Current Assets, after all adjustments
and corrections have been made:
(2) Using the information in #1 above, determine
Total Long-Term Investments after all adjustments
and corrections have been made:
(3) Using the information in #1 above, determine
Total PP&E (net) after all adjustments and
corrections have been made:
(4) Using the information in #1 above, determine
Total Other Assets after all adjustments and
corrections have been made:
(5) Using the information in #1 above, determine
Total Current Liabilities after all adjustments
and corrections have been made:
(6) Using the information in #1 above, determine
Total Long-Term Liabilities after all corrections
have been made:
Account Title | Debits | Credits | Total Current Assets | Total Long term Investments | Total PP&E (net) | Total Other Asset | Total Current Liabilities | Total Long-Term Liabilities |
Cash | $ 83,000.00 | $ 60,000.00 | $ 23,000.00 | |||||
Accounts Receivable (net of Allowance) | $ 256,000.00 | $ 228,000.00 | $ 40,000.00 | $ 12,000.00 | ||||
Prepaid Expenses | $ 32,000.00 | $ 32,000.00 | ||||||
Investments | $ 65,000.00 | $ 25,000.00 | $ 40,000.00 | |||||
Land | $ 175,000.00 | $ 75,000.00 | $ 100,000.00 | |||||
Buildings (net) | $ 160,000.00 | $ 160,000.00 | ||||||
Equipment (net) | $ 145,000.00 | $ 120,000.00 | $ 25,000.00 | |||||
Accounts Payable | $ 73,000.00 | $ 73,000.00 | ||||||
Accrued Expenses | $ 45,000.00 | $ 45,000.00 | ||||||
Unearned Revenue | $ 150,000.00 | $ 50,000.00 | $ 100,000.00 | |||||
Notes Payable | $ 300,000.00 | $ 100,000.00 | $ 200,000.00 | |||||
Common Stock | $ 200,000.00 | |||||||
Retained Earnings | $ 148,000.00 | |||||||
TOTALS | $ 916,000.00 | $ 916,000.00 | $ 345,000.00 | $ 178,000.00 | $ 380,000.00 | $ 25,000.00 | $ 280,000.00 | $ 300,000.00 |
(1) Using this information, determine the amount of Current Assets, after all adjustments and corrections have been made: | $ 345,000.00 | |||||||
(2) Using the information in #1 above, determine Total Long-Term Investments after all adjustments and corrections have been made: | $ 178,000.00 | |||||||
(3) Using the information in #1 above, determine Total PP&E (net) after all adjustments and corrections have been made: | $ 380,000.00 | |||||||
(4) Using the information in #1 above, determine Total Other Assets after all adjustments and corrections have been made: | 0 | |||||||
(5) Using the information in #1 above, determine Total Current Liabilities after all adjustments and corrections have been made: | $ 280,000.00 | |||||||
(6) Using the information in #1 above, determine Total Long-Term Liabilities after all corrections have been made: | $ 300,000.00 |
USE THE FOLLOWING INFORMATION TO ANSWER THE NEXT (6) QUESTIONS: The following is a December 31,...
USE THE FOLLOWING INFORMATION TO ANSWER THE NEXT (6) QUESTIONS: The following is a December 31, 2019, post-closing trial balance for Desert Company: Account Title Debits Credits Cash $ 83,000 Accounts Receivable (net of Allowance) $280,000 Prepaid Expenses $ 32,000 Investments $ 65,000 Land $175,000 Buildings (net) $160,000 Equipment (net) $145,000 Accounts Payable $ 73,000 Accrued Expenses $ 45,000 Unearned Revenue $150,000 Notes Payable $300,000 Common Stock $200,000 Retained Earnings $172,000 TOTALS $940,000 $940,000 Additional Information: 1. The cash account...
USE THE FOLLOWING INFORMATION TO ANSWER THE NEXT (6) QUESTIONS: The following is a December 31, 2019, post-closing trial balance for Desert Company: Account Title Debits Credits Cash $ 83,000 Accounts Receivable (net of Allowance) $280,000 Prepaid Expenses $ 32,000 Investments $ 65,000 Land $175,000 Buildings (net) $160,000 Equipment (net) $145,000 Accounts Payable $ 73,000 Accrued Expenses $ 45,000 Unearned Revenue $150,000 Notes Payable $300,000 Common Stock $200,000 Retained Earnings $172,000 TOTALS $940,000 $940,000 Additional Information: 1. The cash account...
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ne following is a December 31, 2019, post-closing trial balance for Desert Company: Account Title Credits Cash Accounts Receivable (net of Allowance) Debits $ 83,000 $280,000 $ 32,000 $ 65,000 $175,000 Prepaid Expenses Investments Land $160,000 $145,000 Buildings (net) Equipment (net) Accounts Payable Accrued Expenses Unearned Revenue Notes Payable Common Stock Retained Earnings TOTALS $ 73,000 $ 45,000 $150,000 $300,000 $200,000 $172,000 $940,000 $940,000 1. The cash account...
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ne following is a December 31, 2019, post-closing trial balance for Desert Company: Credits Debits $ 83,000 $280,000 $ 32,000 Account Title Cash Accounts Receivable (net of Allowance) Prepaid Expenses Investments Land Buildings (net) Equipment (net) Accounts Payable Accrued Expenses Unearned Revenue Notes Payable Common Stock Retained Earnings TOTALS $ 65,000 $175,000 $160,000 $145,000 $ 73,000 $ 45,000 $150,000 $300,000 $200,000 $172,000 $940,000 $940,000 1. The cash account...
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