) Day 7 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
) Day 7 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
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter12: Intangibles
Section: Chapter Questions
Problem 10MC
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Question
2) Day 7
The following is a December 31, 2021, post-closing
Account Title | Debits | Credits | |||||
Cash | $ | 77,000 | |||||
Investment in equity securities | 142,000 | ||||||
76,000 | |||||||
Inventory | 216,000 | ||||||
Prepaid insurance (for the next 9 months) | 6,000 | ||||||
Land | 122,000 | ||||||
Buildings | 436,000 | ||||||
$ | 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 | ||||||
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.
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