Pharoah Company has decided to expand its operations. The bookkeeper recently completed the following balance sheet in order to obtain additional funds for expansion.PHAROAH COMPANYBALANCE SHEETFOR THE YEAR ENDED 2020Current assets Cash $232,000 Accounts receivable (net) 342,000 Inventory (lower-of-average-cost-or-market) 403,000 Equity investments (marketable)-at cost (fair value $122,000) 142,000Property, plant, and equipment Buildings (net) 572,000 Equipment (net) 162,000 Land held for future use 177,000Intangible assets Goodwill 82,000 Cash surrender value of life insurance 92,000 Prepaid expenses 14,000Current liabilities Accounts payable 137,000 Notes payable (due next year) 127,000 Pension obligation 84,000 Rent payable 51,000 Premium on bonds payable 55,000Long-term liabilities Bonds payable 502,000Stockholders’ equity Common stock, $1.00 par, authorized 400,000 shares, issued 292,000 292,000 Additional paid-in capital 162,000 Retained earnings ? Prepare a revised balance sheet given the available information. Assume that the accumulated depreciation balance for the buildings is $162,000 and for the equipment, $107,000. The allowance for doubtful accounts has a balance of $19,000. The pension obligation is considered a long-term liability.

Balance sheet or statement of financial position is a summary of the financial balances or the…

Answered: Pharoah Company

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Pharoah Company has decided to expand its operations. The bookkeeper recently completed the following balance sheet in order to obtain additional funds for expansion.

PHAROAH COMPANY BALANCE SHEET FOR THE YEAR ENDED 2020
Current assets
Cash		$232,000
Accounts receivable (net)		342,000
Inventory (lower-of-average-cost-or-market)		403,000
Equity investments (marketable)-at cost (fair value $122,000)		142,000
Property, plant, and equipment
Buildings (net)		572,000
Equipment (net)		162,000
Land held for future use		177,000
Intangible assets
Goodwill		82,000
Cash surrender value of life insurance		92,000
Prepaid expenses		14,000
Current liabilities
Accounts payable		137,000
Notes payable (due next year)		127,000
Pension obligation		84,000
Rent payable		51,000
Premium on bonds payable		55,000
Long-term liabilities
Bonds payable		502,000
Stockholders’ equity
Common stock, $1.00 par, authorized 400,000 shares, issued 292,000		292,000
Additional paid-in capital		162,000
Retained earnings		?

Prepare a revised balance sheet given the available information. Assume that the accumulated depreciation balance for the buildings is $162,000 and for the equipment, $107,000. The allowance for doubtful accounts has a balance of $19,000. The pension obligation is considered a long-term liability.

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