Candice Company is currently going through bankruptcy reorganization. The accoun

Question

Candice Company is currently going through bankruptcy reorganization. The accountant has determined the following balances of the accounts at December 31, 2011. Prepare the balance sheet for Candice Company.

Prepare the balance sheet for Candice Company. Retained earnings will need to be calculated.

Retained earnings will need to be calculated.

assets book value fair value cash $30000 $30000 inventory 50000 51000 land 80000 100000 building 70000 95000 equipment 40000 42000 liabilities as of the due date of the order of relief allowed claims expected settlement accounts payable 110000 70000 accrued expenses 40000 15000 income tax payable 24000 19000 note payable secured by land due 2013 75000 75000 liabilities since the date of the order of relief accounts payable 65000 note payable due 2012 50000 common stock 100000

Explanation / Answer

Candice Company All Amounts in $ Balance Sheet for the year ended December 31, 2011 Assets at fair value Current Assets Cash 30000 Inventory 51000 Total Current Assets 81000 Fixed Assets Land 100000 Building 95000 Equipment 42000 Total Fixed Assets 237000 Total Assets 318000 Liabilities at expected settlement Liabilities till the date of the order accounts payable 70000 accrued expenses 15000 income tax payable 19000 note payable secured by land due 2013 75000 Total Liabilities till the date of the order 179000 Liabilities post the order date accounts payable 65000 note payable due 2012 50000 Total Liabilities post the order date 115000 Shareholders' Equity Common Stock 100000 Retained Earnings -76000 Balancing Figure in the Balance Sheet 24000 Total Liabilities and Shareholders' Equity 318000

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