Presented below are a number of balance sheet items for Monty, Inc. for the current year, 2020. Goodwill $ 127,990 Accumulated Depreciation-Equipment $ 292,160 Payroll Taxes Payable 180,581 Inventory 242,790 Bonds payable 302,990 Rent payable (short-term) 47,990 Discount on bonds payable 15,160 Income taxes payable 101,352 Cash 362,990 Rent payable (long-term) 482,990 Land 482,990 Common stock, $1 par value 202,990 Notes receivable 448,690 Preferred stock, $10 par value 152,990 Notes payable (to banks) 267,990 Prepaid expenses 90,910 Accounts payable 492,990 Equipment 1,472,990 Retained earnings ? Debt investments (trading) 123,990 Income taxes receivable 100,620 Accumulated Depreciation-Buildings 270,360 Notes payable (long-term) 1,602,990 Buildings 1,642,990 Prepare a classified balance sheet in good form. Common stock authorized was 400,000 shares, and preferred stock authorized was 20,000 shares. Assume that notes receivable and notes payable are short-term, unless stated otherwise. Cost and fair value of debt investments (trading) are the same.
Reporting Cash Flows
Reporting of cash flows means a statement of cash flow which is a financial statement. A cash flow statement is prepared by gathering all the data regarding inflows and outflows of a company. The cash flow statement includes cash inflows and outflows from various activities such as operating, financing, and investment. Reporting this statement is important because it is the main financial statement of the company.
Balance Sheet
A balance sheet is an integral part of the set of financial statements of an organization that reports the assets, liabilities, equity (shareholding) capital, other short and long-term debts, along with other related items. A balance sheet is one of the most critical measures of the financial performance and position of the company, and as the name suggests, the statement must balance the assets against the liabilities and equity. The assets are what the company owns, and the liabilities represent what the company owes. Equity represents the amount invested in the business, either by the promoters of the company or by external shareholders. The total assets must match total liabilities plus equity.
Financial Statements
Financial statements are written records of an organization which provide a true and real picture of business activities. It shows the financial position and the operating performance of the company. It is prepared at the end of every financial cycle. It includes three main components that are balance sheet, income statement and cash flow statement.
Owner's Capital
Before we begin to understand what Owner’s capital is and what Equity financing is to an organization, it is important to understand some basic accounting terminologies. A double-entry bookkeeping system Normal account balances are those which are expected to have either a debit balance or a credit balance, depending on the nature of the account. An asset account will have a debit balance as normal balance because an asset is a debit account. Similarly, a liability account will have the normal balance as a credit balance because it is amount owed, representing a credit account. Equity is also said to have a credit balance as its normal balance. However, sometimes the normal balances may be reversed, often due to incorrect journal or posting entries or other accounting/ clerical errors.
Presented below are a number of
|
|
$ 127,990 |
|
$ 292,160 | |||
|---|---|---|---|---|---|---|
|
Payroll Taxes Payable
|
180,581 |
Inventory
|
242,790 | |||
|
Bonds payable
|
302,990 |
Rent payable (short-term)
|
47,990 | |||
|
Discount on bonds payable
|
15,160 |
Income taxes payable
|
101,352 | |||
|
Cash
|
362,990 |
Rent payable (long-term)
|
482,990 | |||
|
Land
|
482,990 |
Common stock, $1 par value
|
202,990 | |||
|
Notes receivable
|
448,690 |
|
152,990 | |||
|
Notes payable (to banks)
|
267,990 |
Prepaid expenses
|
90,910 | |||
|
Accounts payable
|
492,990 |
Equipment
|
1,472,990 | |||
|
|
? |
Debt investments (trading)
|
123,990 | |||
|
Income taxes receivable
|
100,620 |
Accumulated Depreciation-Buildings
|
270,360 | |||
|
Notes payable (long-term)
|
1,602,990 |
Buildings
|
1,642,990 |
Prepare a classified balance sheet in good form. Common stock authorized was 400,000 shares, and preferred stock authorized was 20,000 shares. Assume that notes receivable and notes payable are short-term, unless stated otherwise. Cost and fair value of debt investments (trading) are the same.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 1 images
