The following information was available from the Statement of Affairs of Moses Corporation on November 1, 2015. Accounts Est. Realizable Value Cash 3, 000 Accounts receivable 48, 000 Inventories 72, 000 Equipment 87, 000 Wages payable Notes payable (Note payable and interests are secured by Equipment) 45, 000 90, 000 Accrued interest of notes 6, 000 Accounts payable 72, 000 Rent payable 27, 000 Estate deficit 30, 000 For the next two months (November and December) the following transactions occurred: 1. Credit sales for three forth of the inventory amounts to 56, 000. 2. An Equipment with value of 47, 000 are disposed at 40, 000 cash. Partial payment of notes payable - 41, 000 to principal and 6, 000 to interest. 4. Old receivables: Collected 23, 000 from receivables with est. realizable value of 25, 000. 5. New receivables: Collected 40, 000 (The balance of the new receivables are still collectible). 6. Payment of wages payable, 45, 000. 7. Incurred liquidation expenses of 5, 000. Only 4, 000 were paid. 8. Partial payment of rent payable, 12, 000. 3. Compute the following amounts: a. What is the gain/loss that will be reported in the statement of realization and liquidation for the 2 months? Indicate if gain or loss. b. What is the total cash received from realization of assets for the 2 months (November and December)? c. What is the total cash disbursed for 2 months (November and December)? d. What is the total non-cash assets on Dec 31, 2015 e. What is the total liabilities on Dec 31, 2015 For this number, answer A. What is the gain/loss that will be reported in the statement of realization and liquidation for the 2 months? Positive for gain and negative for loss.
The following information was available from the Statement of Affairs of Moses Corporation on November 1, 2015. Accounts Est. Realizable Value Cash 3, 000 Accounts receivable 48, 000 Inventories 72, 000 Equipment 87, 000 Wages payable Notes payable (Note payable and interests are secured by Equipment) 45, 000 90, 000 Accrued interest of notes 6, 000 Accounts payable 72, 000 Rent payable 27, 000 Estate deficit 30, 000 For the next two months (November and December) the following transactions occurred: 1. Credit sales for three forth of the inventory amounts to 56, 000. 2. An Equipment with value of 47, 000 are disposed at 40, 000 cash. Partial payment of notes payable - 41, 000 to principal and 6, 000 to interest. 4. Old receivables: Collected 23, 000 from receivables with est. realizable value of 25, 000. 5. New receivables: Collected 40, 000 (The balance of the new receivables are still collectible). 6. Payment of wages payable, 45, 000. 7. Incurred liquidation expenses of 5, 000. Only 4, 000 were paid. 8. Partial payment of rent payable, 12, 000. 3. Compute the following amounts: a. What is the gain/loss that will be reported in the statement of realization and liquidation for the 2 months? Indicate if gain or loss. b. What is the total cash received from realization of assets for the 2 months (November and December)? c. What is the total cash disbursed for 2 months (November and December)? d. What is the total non-cash assets on Dec 31, 2015 e. What is the total liabilities on Dec 31, 2015 For this number, answer A. What is the gain/loss that will be reported in the statement of realization and liquidation for the 2 months? Positive for gain and negative for loss.
Financial Accounting
15th Edition
ISBN:9781337272124
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
Chapter6: Accounting For Merchandising Businesses
Section: Chapter Questions
Problem 5PA: The following selected accounts and their current balances appear in the ledger of Clairemont Co....
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Transcribed Image Text:The following information was available from the Statement of Affairs of Moses Corporation on November 1,
2015.
Accounts
Cash
Est. Realizable Value
3, 000
Accounts receivable
48, 000
Inventories
72, 000
87, 000
Equipment
Wages payable
Notes payable (Note payable and interests are secured by Equipment)
45, 000
90, 000
Accrued interest of notes
6, 000
Accounts payable
72, 000
Rent payable
Estate deficit
27, 000
30, 000
For the next two months (November and December) the following transactions occurred:
1. Credit sales for three forth of the inventory amounts to 56, 000.
2. An Equipment with value of 47, 000 are disposed at 40, 000 cash.
3. Partial payment of notes payable - 41, 000 to principal and 6, 000 to interest.
Old receivables: Collected 23, 000 from receivables with est. realizable value of 25, 000.
4.
New receivables: Collected 40, 000 (The balance of the new receivables are still collectible).
6. Payment of wages payable, 45, 000.
7. Incurred liquidation expenses of 5, 000. Only 4, 000 were paid.
8. Partial payment of rent payable, 12, 000.
5.
Compute the following amounts:
a. What is the gain/loss that will be reported in the statement of realization and liquidation for the 2 months?
Indicate if gain or loss.
b. What is the total cash received from realization of assets for the 2 months (November and December)?
c. What is the total cash disbursed for 2 months (November and December)?
d. What is the total non-cash assets on Dec 31, 2015
e. What is the total liabilities on Dec 31, 2015
For this number, answer A. What is the gain/loss that will be reported in the statement of realization and
liquidation for the 2 months? Positive for gain and negative for loss.
Answer:
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