The bookkeeper for Geronimo Company has prepared the following balance sheet as
ID: 2423190 • Letter: T
Question
The bookkeeper for Geronimo Company has prepared the following balance sheet as of July 31, 2014.
GERONIMO COMPANY
BALANCE SHEET
AS OF JULY 31, 2014
The following additional information is provided.
Prepare a corrected classified balance sheet as of July 31, 2014, from the available information, adjusting the account balances using the additional information.
GERONIMO COMPANY
BALANCE SHEET
AS OF JULY 31, 2014
Explanation / Answer
GERONIMO COMPANY CORRECTED CLASSFIED BALANCE SHEET AS OF JULY 31, 2014 Current Assets Current Liabilities Cash 70,970 Taxes Payable 9,280 Petty Cash 1,200 Notes and Accounts Payable 38,960 48,240 Accounts Receivable 42,540 Less: Allowance for Doubtful Accounts (3,500) Long-Term Liabilities 78,170 Merchandise Inventory 68,870 Total Current Assets 1,80,080 Stockholders' Equity 1,58,670 Property, Plant, and Equipment Equipment 1,16,240 Less: Accumulated Depreciation, Equipment (32,240) 84,000 Patents 21,000 Total $2,85,080 Total $2,85,080 1. Cash includes $1,200 in a petty cash fund and $15,100 in a bond sinking fund.- CLASSIFIED ACCORDINGLY 2. The net accounts receivable balance is comprised of the following two items: (a) accounts receivable $48,240 and (b) allowance for doubtful accounts $3,500.CLASSIFIED ACCORDINGLY 3. Inventory costing $5,700 was shipped out on consignment on July 31, 2014. The ending inventory balance does not include the consigned goods. Receivables in the amount of $5,700 were recognized on these consigned goods.- ADDED TO INVENTORY, REDUCED FROM DEBTORS 4. Equipment had a cost of $116,240 and an accumulated depreciation balance of $32,240.CLASSIFIED ACCORDINGLY 5. Income taxes payable of $9,280 were accrued on July 31. Geronimo Company, however, had set up a cash fund to meet this obligation. This cash fund was not included in the cash balance, but was offset against the income taxes payable amount.CLASSIFIED ACCORDINGLY
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