Chapter 1, Problem 37E

Exercise 1-37 Balance Sheet Structure

The following accounts exist in the ledger of Higgins Company: accounts payable, accounts receivable, accumulated depreciation, bonds payable, building, common stock, cash, equipment, income taxes payable, inventory, notes payable (due in 5 years), prepaid insurance, retained earnings, trademarks, and wages payable.

Required:

1. Organize the above items into a properly prepared classified balance sheet.
2. CONCEPTUAL CONNECTION Which information might be helpful to assess liquidity?