M2-22 Preparing a Classified Balance Sheet [LO 2-4, LO 2-5] [The following infor
ID: 2407422 • Letter: M
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M2-22 Preparing a Classified Balance Sheet [LO 2-4, LO 2-5] [The following information applies to the questions displayed below] The following accounts are taken from the financial statem mber 30, 2013. (Amounts are in millions.) $980 3.450 11,800 3,400 370 120 1,250 370 1.450 3,300 8,800 7000 2,400 Accounts Payable Cash Common Stock Equipment Income Tax Expense Interest Expense Notes Payable (short-term) Prepaid Rent Retained Earnings Short-term Investments References M2-22 Preparing a Classified Balance Sheet [LO 2-4, LO 2-5]Explanation / Answer
Classified balance sheet of paradise resorts as at sept 30,2013 Paradise Resorts Balance sheet (In Millions) Liabilities Amount($) Assets Amount($) Stock Holder's Equity Property,plant and equipment Common stock 11800 Software 2400 Retained earnings 3300 15100 Equipment 3400 Long term liabilities Short term investments 7000 Notes payable 1250 Current liabilities Current assets Accounts payable 980 Cash 3450 Notes payable 370 1350 Prepaid rent 1450 4900 17700 17700 Current ratio = current assets / current liabilities Here, current assets = 4900 Current liabilities = 1350 Hence , current ratio = 3.63 Times
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