The following balance sheet, which has some weaknesses in terminology and classification, has been prepared by an inexperienced accountant and submitted to you for review: Mikeska Company Balance Sheet as of December 31, 20X1 ($ in thousands) Assets Fixed assets—tangible Land $ 500 Buildings and equipment 200 Less: Reserve for depreciation (50 ) $ 650 Factory supplies 20 Current assets Inventory 163 Accounts receivable 102 Cash 68 333 Fixed assets—intangibles Patents 51 Goodwill 49 100 Deferred charges Discount on bonds payable 12 Returnable containers 32 44 Total assets $ 1,147 Liabilities Current liabilities Accounts payable 140 Allowance for doubtful accounts 7 Wages payable 195 $ 342 Long-term liabilities Bonds payable 400 Reserve for contingencies 50 450 Equity Capital stock, $10 par, 5,000 shares issued and outstanding 50 Capital surplus 75 Earned surplus 270 Dividends paid (40 ) 355 Total liabilities $ 1,147 Required: Prepare a classified balance sheet. Make any necessary corrections.
The following balance sheet, which has some weaknesses in terminology and classification, has been prepared by an inexperienced accountant and submitted to you for review: Mikeska Company Balance Sheet as of December 31, 20X1 ($ in thousands) Assets Fixed assets—tangible Land $ 500 Buildings and equipment 200 Less: Reserve for depreciation (50 ) $ 650 Factory supplies 20 Current assets Inventory 163 Accounts receivable 102 Cash 68 333 Fixed assets—intangibles Patents 51 Goodwill 49 100 Deferred charges Discount on bonds payable 12 Returnable containers 32 44 Total assets $ 1,147 Liabilities Current liabilities Accounts payable 140 Allowance for doubtful accounts 7 Wages payable 195 $ 342 Long-term liabilities Bonds payable 400 Reserve for contingencies 50 450 Equity Capital stock, $10 par, 5,000 shares issued and outstanding 50 Capital surplus 75 Earned surplus 270 Dividends paid (40 ) 355 Total liabilities $ 1,147 Required: Prepare a classified balance sheet. Make any necessary corrections.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
The following
Mikeska Company | ||||||
Balance Sheet as of December 31, 20X1 ($ in thousands) |
||||||
Assets | ||||||
Fixed assets—tangible | ||||||
Land | $ | 500 | ||||
Buildings and equipment | 200 | |||||
Less: Reserve for |
(50 | ) | $ | 650 | ||
Factory supplies | 20 | |||||
Current assets | ||||||
Inventory | 163 | |||||
102 | ||||||
Cash | 68 | 333 | ||||
Fixed assets—intangibles | ||||||
Patents | 51 | |||||
49 | 100 | |||||
Deferred charges | ||||||
Discount on bonds payable | 12 | |||||
Returnable containers | 32 | 44 | ||||
Total assets | $ | 1,147 | ||||
Liabilities | ||||||
Current liabilities | ||||||
Accounts payable | 140 | |||||
Allowance for doubtful accounts | 7 | |||||
Wages payable | 195 | $ | 342 | |||
Long-term liabilities | ||||||
Bonds payable | 400 | |||||
Reserve for contingencies | 50 | 450 | ||||
Equity | ||||||
Capital stock, $10 par, 5,000 shares issued and outstanding | 50 | |||||
Capital surplus | 75 | |||||
Earned surplus | 270 | |||||
Dividends paid | (40 | ) | 355 | |||
Total liabilities | $ | 1,147 | ||||
Required:
Prepare a classified balance sheet. Make any necessary corrections. (Enter your answers in thousands. Amounts to be deducted should be entered with a minus sign.)
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