FINANCIAL ACCOUNTING: TOOLS WP ACCESS
8th Edition
ISBN: 9781119230069
Author: Kimmel
Publisher: WILEY
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Chapter 2, Problem 2.1BDIE
To determine
Balance sheet: Balance sheet is the financial statement which reports a company’s resources (assets) and claims of creditors (liabilities) and stockholders (
- Assets: These are the resources owned and controlled by business and used to produce benefits for the company. Assets are classified on the balance sheet as current assets (cash, receivables, short-term investments, inventory, and supplies), long-term investments, property, plant, and equipment (fixed assets like land, furniture, buildings) , and intangible assets (
goodwill , trademarks, patents, and franchises). - Liabilities: The claims creditors have over assets or resources of a company are referred to as liabilities. These are the debt obligations owed by company to creditors. Liabilities are classified on the balance sheet as current liabilities (accounts payable, salaries payable, income taxes payable, short-term notes payable, and unearned revenue) and long-term liabilities (notes payable, bonds payable, and mortgage payable).
- Stockholders’ equity: The claims of owners on a company’s resources after the liabilities are paid off is referred to as stockholders’ equity. Therefore, stockholders’ equity is sometimes referred to as net worth of owners or shareholders or stockholders. The two parts of stockholders’ equity are common stock and
retained earnings .
To match: The financial statement items to its corresponding account according to balance sheet classification
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Assume that Fielder Enterprises uses the following headings on its balance sheet.
a. Current assets.
b. Investments.
c. Property, plant, and equipment.
d. Intangible assets.
e. Other assets.
f. Current liabilities.
g. Long-term liabilities.
h. Capital stock.
i. Equity attributed to noncontrolling interest.
j. Paid-in capital in excess of par.
k. Retained earnings.
Instructions
Indicate by letter how each of the following usually should be classified. If an item should appear in a note to the financial statements, use the letter “N” to indicate this fact. If an item need not be reported at all on the balance sheet, use the letter “X.”
1. Prepaid insurance.
2. Stock owned in affiliated companies.
3. Unearned service revenue.
4. Advances to suppliers.
5. Unearned rent revenue.
6. Preferred stock.
7. Additional paid-in capital on preferred stock.
8. Copyrights.
9. Petty cash fund.
10. Sales taxes payable.
11. Accrued…
(Classification of Balance Sheet Accounts) Assume that Fielder Enterprises uses the following headings on its balance sheet.
a. Current assets.b. Long-term Investments.c. Property, plant, and equipment.d. Intangible assets.e. Other assets.f. Current liabilities.g. Long-term liabilities.h. Capital stock.i. Paid-in capital in excess of par.j. Retained earnings.
Instructions:Indicate by letter how each of the following usually should be classified. If an item should appear in a note to the financial statements, use the letter “N” to indicate this fact. If an item need not be reported at all on the balance sheet, use the letter “X.”
1. Prepaid insurance.2. Stock owned in another company.3. Unearned service revenue.4. Advances to suppliers.5. Unearned rent revenue.6. Preferred stock.7. Additional paid-in capital on preferred stock.8. Copyrights.9. Petty cash fund.10. Sales taxes payable.11. Accrued interest on notes receivable.12. Twenty-year issue of bonds payable that will mature within…
Presented below are a number of balance sheet items for radiant, Inc. for the current year, 2020.
Goodwill
$ 126,520
Accumulated Depreciation-Equipment
$ 292,470
Payroll Taxes Payable
179,111
Inventory
241,320
Bonds payable
301,520
Rent payable (short-term)
46,520
Discount on bonds payable
15,470
Income taxes payable
99,882
Cash
361,520
Rent payable (long-term)
481,520
Land
481,520
Common stock, $1 par value
201,520
Notes receivable
447,220
Preferred stock, $10 par value
151,520
Notes payable (to banks)
266,520
Prepaid expenses
89,440
Accounts payable
491,520
Equipment
1,471,520
Retained earnings
?
Debt investments (trading)
122,520
Income taxes receivable
99,150
Accumulated Depreciation-Buildings
270,670
Notes payable (long-term)
1,601,520
Buildings
1,641,520
Prepare a classified balance sheet in good form. Common stock authorized was…
Chapter 2 Solutions
FINANCIAL ACCOUNTING: TOOLS WP ACCESS
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