The following balance sheet for the Los Gatos Corporation was prepared by a recently hired accountant. In reviewing the statement you notice several errors. Cash Accounts receivable Inventory Machinery (net) Franchise (net) Total assets LOS GATOS CORPORATION Balance Sheet At December 31, 2024 Assets Notes payable Bonds payable Liabilities and Shareholders' Equity Accounts payable Allowance for uncollectible accounts Shareholders' equity Total liabilities and shareholders' equity $ 44,ᎾᎾᎾ 86,000 57,000 122,000 32,000 $ 341,000 $ 54,000 7,000 59,000 112,000 109,000 $ 341,000 Additional Information: 1. Cash includes a $22,000 restricted amount to be used for repayment of the bonds payable in 2028. 2. The cost of the machinery is $194,000. 3. Accounts receivable includes a $22,000 notes receivable from a customer due in 2027. 4. The notes payable balance includes accrued interest of $7,000. Principal and interest are both due on February 1, 2025. 5. The company began operations in 2019. Net income less dividends since inception of the company totals $37,000.
The following balance sheet for the Los Gatos Corporation was prepared by a recently hired accountant. In reviewing the statement you notice several errors. Cash Accounts receivable Inventory Machinery (net) Franchise (net) Total assets LOS GATOS CORPORATION Balance Sheet At December 31, 2024 Assets Notes payable Bonds payable Liabilities and Shareholders' Equity Accounts payable Allowance for uncollectible accounts Shareholders' equity Total liabilities and shareholders' equity $ 44,ᎾᎾᎾ 86,000 57,000 122,000 32,000 $ 341,000 $ 54,000 7,000 59,000 112,000 109,000 $ 341,000 Additional Information: 1. Cash includes a $22,000 restricted amount to be used for repayment of the bonds payable in 2028. 2. The cost of the machinery is $194,000. 3. Accounts receivable includes a $22,000 notes receivable from a customer due in 2027. 4. The notes payable balance includes accrued interest of $7,000. Principal and interest are both due on February 1, 2025. 5. The company began operations in 2019. Net income less dividends since inception of the company totals $37,000.
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
Chapter4: The Balance Sheet And The Statement Of Shareholders' Equity
Section: Chapter Questions
Problem 7P: Complex Balance Sheet Presented below is the unaudited balance sheet as of December 31, 2019,...
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Prepare a corrected, classified balance sheet . Use the additional information to help determine appropriate classifications and account balances. The cost of machinery and its accumulated depreciation are shown separately. Note: Amounts to be deducted should be indicated by a minus sign.
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