Chapter 15.I, Problem 35RE

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8th Edition

Robert Brechner + 1 other

ISBN: 9781305585447

Textbook Problem

a. Use the following financial information to prepare a balance sheet with vertical analysis as of June 30, 2015, for Stargate Industries. Inc.: cash. $44,300; accounts receivable. $127,600; merchandise inventory. $88,100; prepaid maintenance. $4,100; office supplies. $4,000; land. $154,000; building. $237,000; fixtures. $21,400; vehicles. $64,000; computers, $13,000; goodwill, $20,000; investments. $32,000; accounts payable. $55,700; salaries payable. $23,200; notes payable (6-month). $38,000; mortgage payable. $91,300; debenture bonds. $165,000; common stock. $350,000; and retained earnings. $86,300.

**Stargate Industries. Inc.**

**Balance Sheet**

**June 30, 2015**

b. The following financial information is for Stargate Industries as of June 30, 2016: cash. $40,200; accounts receivable. $131,400; merchandise inventory. $92,200; prepaid maintenance. $3,700; office supplies. $6,200; land. $154,000; building. $231,700; futures. $23,900; vehicles; $55,100; computers. $16,800; goodwill. $22,000; investments. $36,400; accounts payable. $51,800; salaries payable. $25,100; notes payable (6-month). $19,000; mortgage payable. $88,900; debenture bonds. $165,000; common stock. $350,000; and retained earnings. $113,800.

Prepare a comparative balance sheet with horizontal analysis for 2015 and 2016.

**Stargate Industries. Inc.**

**Comparative Balance Sheet**

**June 30, 2015 and 2016**

**(a)**

To determine

**To calculate:** The balance sheet with vertical analysis as of June

Explanation

**Given Information:**

Stargate industries, Inc. which has cash of

**Formula used:**

The formula to compute the ownerâ€™s equity is,

Follow the steps to prepare a balance sheet

Step

Step

Step

Step

Step

Step

Step

Step

Step

**Calculation:**

Consider the provided infor4mation,

Compute Total Current Assets by adding all the current assets:

Compute total of Property, Plant and Equipment by adding all Property, Plant and Equipment

Compute Total Assets by adding the current assets and property, plant and equipment.

Compute Total Current Liabilities by adding all current liabilities.

Compute Total Liabilities by adding total current liabilities to total long-term liabilities

**(b)**

To determine

**To calculate:** The comparative balance sheet with horizontal analysis of Stargate industries, Inc. which has cash of

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