Account Title Cash Accounts receivable Inventories Interest payable Marketable s
ID: 2609417 • Letter: A
Question
Account Title Cash Accounts receivable Inventories Interest payable Marketable securities Land Buildings Accumulated depreciation-buildings Equipment Accumulated depreciation-equipment Copyright (net of amortization) Prepaid expenses (next 12 months) Accounts payable Deferred revenues (next 12 months) Notes payable Allowance for uncollectible accounts Common stock Retained earnings Totals Debits Credits 27,000 60,000 85,000 12,000 48,000 124,000 310,000 102,000 79,000 27,000 14,000 34,000 67,000 22,000 260,000 7,000 220,000 64,000 781,000 781,000 Additional information: 1. The $124,000 balance in the land account consists of $102,000 for the cost of land where the plant and office buildings are located 2. The $48,000 in the marketable securities account represents an investment in the common stock of another corporation. Valley 3. The notes payable account consists of a $104,000 note due in six months and a $156,000 note due in three annual installments of The remaining $22,000 represents the cost of land being held for speculation intends to sell one-half of the stock within the next year. $52,000 each, with the first payment due in August of 2019Explanation / Answer
Answer:
VALLEY PUMP CORPORATION
Balance Sheet
At December 31, 2018
Assets
Current assets:
Cash
$27,000
Marketable securities
24,000
Accounts receivable, net of allowance for
uncollectible accounts of $7,000
53,000
Inventories
85,000
Prepaid expenses
34,000
Total current assets
223,000
Investments:
Marketable securities
$24,000
Land
22,000
Total investments
46,000
Property, plant, and equipment:
Land
102,000
Buildings
310,000
Equipment
79,000
491,000
Less: Accumulated depreciation
-129,000
Net property, plant, and equipment
362,000
Intangible assets:
Copyright
14,000
Total assets
$645,000
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable
$67,000
Interest payable
$12,000
Differed revenue
22,000
Note payable
104,000
Current maturities of long-term debt
52,000
Total current liabilities
257,000
Long-term liabilities:
Note payable
104,000
Shareholders’ equity:
Common stock
$220,000
Retained earnings
64,000
Total shareholders’ equity
284,000
Total liabilities and shareholders’ equity
$645,000
VALLEY PUMP CORPORATION
Balance Sheet
At December 31, 2018
Assets
Current assets:
Cash
$27,000
Marketable securities
24,000
Accounts receivable, net of allowance for
uncollectible accounts of $7,000
53,000
Inventories
85,000
Prepaid expenses
34,000
Total current assets
223,000
Investments:
Marketable securities
$24,000
Land
22,000
Total investments
46,000
Property, plant, and equipment:
Land
102,000
Buildings
310,000
Equipment
79,000
491,000
Less: Accumulated depreciation
-129,000
Net property, plant, and equipment
362,000
Intangible assets:
Copyright
14,000
Total assets
$645,000
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable
$67,000
Interest payable
$12,000
Differed revenue
22,000
Note payable
104,000
Current maturities of long-term debt
52,000
Total current liabilities
257,000
Long-term liabilities:
Note payable
104,000
Shareholders’ equity:
Common stock
$220,000
Retained earnings
64,000
Total shareholders’ equity
284,000
Total liabilities and shareholders’ equity
$645,000
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