Assets Goodwill (Note 1) Buildings (Note 2) Inventory Pina Colada Corporation Statement of Financial Position December 31, 2023 Investments-trading (Note 3) Land Accounts receivable $87,500 2,050,000 390,125 125,000 1,187,500 212,500 Investments in shares (FV-OCI) (Note 3) 108,750 Cash Assets allocated to trustee for plant expansion 219,875 Cash 150,000 Treasury notes, at cost and fair value 172,500 $4,703,750 Equities Notes payable (Note 4) Common shares, unlimited authorized, 500,000 issued Retained earnings Accounts payable Appreciation capital (Note 2) Income tax payable Reserve for depreciation of building $750,000 1,437,500 882,500 315,000 712,500 93,750 512,500 $4,703,750 Note 1: Goodwill in the amount of $87,500 was recognized because the company believed that the carrying amount of assets was not an accurate representation of the company's fair value. The gain of $87,500 was credited to Retained Earnings. Note 2: Buildings are stated at cost, except for one building that was recorded at its appraised value because management determined the building to be worth more than originally paid at acquisition. The excess of the appraisal value over cost was $712,500. Depreciation has been recorded based on cost. Note 3: Investments-trading are FV-NI investments and have a fair value of $93,750. Investments in shares (FV-OCI) have a fair value of $250,000. Both investments are currently recorded at cost. Note 4: Notes payable are long term except for the current principal instalment due of $125,000. Prepare a corrected classified statement of financial position in good form. The notes above are for information only. Assume that you have decided not to use the revaluation model for property, plant, and equipment. (List Current Assets in order of liquidity. List Property, Plant, and Equipment in order of Land, and Buildings.) Current Assets Total Current Assets Total Assets PINA COLADA CORPORATION Statement of Financial Position December 31, 2023 Assets $ 19

Assets Goodwill (Note 1) Buildings (Note 2) Inventory Pina Colada Corporation Statement of Financial Position December 31, 2023 Investments-trading (Note 3) Land Accounts receivable $87,500 2,050,000 390,125 125,000 1,187,500 212,500 Investments in shares (FV-OCI) (Note 3) 108,750 Cash Assets allocated to trustee for plant expansion 219,875 Cash 150,000 Treasury notes, at cost and fair value 172,500 $4,703,750 Equities Notes payable (Note 4) Common shares, unlimited authorized, 500,000 issued Retained earnings Accounts payable Appreciation capital (Note 2) Income tax payable Reserve for depreciation of building $750,000 1,437,500 882,500 315,000 712,500 93,750 512,500 $4,703,750 Note 1: Goodwill in the amount of $87,500 was recognized because the company believed that the carrying amount of assets was not an accurate representation of the company's fair value. The gain of $87,500 was credited to Retained Earnings. Note 2: Buildings are stated at cost, except for one building that was recorded at its appraised value because management determined the building to be worth more than originally paid at acquisition. The excess of the appraisal value over cost was $712,500. Depreciation has been recorded based on cost. Note 3: Investments-trading are FV-NI investments and have a fair value of $93,750. Investments in shares (FV-OCI) have a fair value of $250,000. Both investments are currently recorded at cost. Note 4: Notes payable are long term except for the current principal instalment due of $125,000. Prepare a corrected classified statement of financial position in good form. The notes above are for information only. Assume that you have decided not to use the revaluation model for property, plant, and equipment. (List Current Assets in order of liquidity. List Property, Plant, and Equipment in order of Land, and Buildings.) Current Assets Total Current Assets Total Assets PINA COLADA CORPORATION Statement of Financial Position December 31, 2023 Assets $ 19

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter24: Analysis Of Financial Statements

Section: Chapter Questions

Problem 5CE

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