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The following is a December 31, 2021, post-closing trial balance for Almway Corporation
The following is a December 31, 2021, post-closing trial balance for Almway Corporation.
| Account Title | Debits | Credits | |||||||
| Cash | $ | 77,000 | |||||||
| Investment in equity securities | 142,000 | ||||||||
| Accounts receivable | 76,000 | ||||||||
| Inventory | 216,000 | ||||||||
| Prepaid insurance (for the next 9 months) | 6,000 | ||||||||
| Land | 122,000 | ||||||||
| Buildings | 436,000 | ||||||||
| Accumulated depreciation—buildings | $ | 116,000 | |||||||
| Equipment | 126,000 | ||||||||
| Accumulated depreciation—equipment | 76,000 | ||||||||
| Patent (net) | 26,000 | ||||||||
| Accounts payable | 107,000 | ||||||||
| Notes payable | 178,000 | ||||||||
| Interest payable | 36,000 | ||||||||
| Bonds Payable | 256,000 | ||||||||
| Common stock | 348,000 | ||||||||
| Retained earnings | 110,000 | ||||||||
| Totals | $ | 1,227,000 | $ | 1,227,000 | |||||
Additional information:
- The investment in equity securities account includes an investment in common stock of another corporation of $46,000 which management intends to hold for at least three years. The balance of these investments is intended to be sold in the coming year.
- The land account includes land which cost $41,000 that the company has not used and is currently listed for sale.
- The cash account includes $31,000 restricted in a fund to pay bonds payable that mature in 2024 and $39,000 restricted in a three-month Treasury bill.
- The notes payable account consists of the following:
- a $46,000 note due in six months.
- a $66,000 note due in six years.
- a $66,000 note due in five annual installments of $13,200 each, with the next installment due February 15, 2022.
- The $76,000 balance in accounts receivable is net of an allowance for uncollectible accounts of $6,000.
- The common stock account represents 116,000 shares of no par value common stock issued and outstanding. The corporation has 300,000 shares authorized.
Prepare a classified balance sheet for the Almway Corporation at December 31, 2021. (Amounts to be deducted should be indicated by a minus sign.)
Expert Solution
Answer:
Classified Balance sheet for Almway corporation
| Particulars | Amount ($) | Amount ($) |
| ASSETS | ||
| Current Assets | ||
| Cash [$77000 - $31000 (Restricted to pay Bonds payable) |
46000 | |
| Accounts receivable | 76000 | |
| Inventory | 216000 | |
| Prepaid insurance | 6000 | |
| Short term investments [$142000 - $46000 (3 year investment)] |
96000 | |
| Total Current Assets | 440000 | |
| Investments | ||
| Marketable securities | 46000 | |
| Land held for sale | 41000 | |
| Restricted cash | 31000 | |
| Total investments | 118000 | |
| Property, Plant and Equipment | ||
| Land [$122000 - $41000 (Held for sale)] |
81000 | |
| Building | 436000 | |
| Equipment | 126000 | |
| Less: Accumulated depreciation [$116000 (Building) + $76000 (Equipment)] |
(192000) | |
| Total Property, Plant and Equipment | 451000 | |
| Intangible Assets | ||
| Patents | 26000 | |
| TOTAL ASSETS | 1035000 | |
| LIABILITIES AND SHAREHOLDERS EQUITY | ||
| Current Liabilities | ||
| Accounts payable | 107000 | |
| Notes payable (due in 6 months) |
46000 | |
| Interest payable | 36000 | |
| Long term debt - Current maturity | 13200 | |
| Total Current Liabilities | 202200 | |
| Long term Liabilities | ||
| Notes payable [$178000 - $46000 (current) - $13200 (1st year's installment)] |
118800 | |
| Bonds payable | 256000 | |
| Total Long term liabilities | 374800 | |
| Shareholders Equity | ||
| Common stock | 348000 | |
| Retained earnings | 110000 | |
| Total Shareholders Equity | 458000 | |
| TOTAL LIABILITES AND SHAREHOLDERS EQUITY | 1035000 |
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