Can someone help me with this accounting problem?? prepare a balance sheet?

Question

the following info (listed in random order) is available for a company at dec. 31 2008:
uncollectible account expense 12000
income taxes payable(current) 36625
patents 58500
cash surrender value of life insurance policies 10800
accounts receivable 102000-net of credit balances of 10000 arising "from advance payments by customers" 92000
sales 450000
allowance for doubtful accounts 5800
cash on hand 44825
cash in bank 26000
short-term prepayments of expenses 3500
dividends received as revenue 4500
R/E-ending 12/31/08 (adjusted) 232800
current installment of long-term debt 20000
7% long-term not payable(only long term portion) 230000
accounts payable 220000
inventories 332600
marketable securities 58500
depreciation expense 19900
building and equipment 400000
accumulated depre 109600
paid-in capital in excess of par 155200
capital stock $2 100000 shares authorized 60000
long-term advance to affiliated company 50000
error in inventory pricing in 05 12500
discontinued operational loss 42000

sales returns and allowances 3100


I have been trying this problem the whole day. i don't know where some accounts belong to so please help me with this problem. thank you

Answer 1

Balance Sheet as at Dec 31, 2008

Non-current assets
Patents 58,500
Loan to affiliate 50,000
Building & equipment (nbv) 290,400
Sub-total 398,900

Current assets
Inventories 332,600
Cash surrender value 10,800
Marketable securities (at mkt value) 51,800
A/cs receivable (net) 86,200
Prepaid exp. 3,500
Bank 26,000
Cash 44,825
Sub-total 555,725

Total Assets 954,625

Liabilities & Equity
Non-current liabilities
Long-term portion of notes payable 230,000

Current liabilities
A/cs payable 220,000
Current portion of L-T debt 20,000
Income tax payable 36,625
Sub-total 276,625

Total Liabilities 506,625

Equity
Common stock 60,000
Paid-in capital in excess of par 155,200
Retained earnings 232,800
Sub-total 448,000

Total Liabilities & Equity 954,625

Note : FASB Technical Bulletin No. 85-4 requires that the amount that could be realized under the insurance contract as of the date of the statement of financial position should be reported as an asset. But stay alert to changes as this treatment is being looked at now.
Also, marketable securities should be stated at the lower of cost and market. In this case, mkt is lower so we use mkt and not cost. This was the info you gave me separately.

Answer 2

If you dont know that an item called depreciation expense is an income statement item, whereas accumulated depreciation is a balance sheet item..then you need a tutor..not someone to answer this question on the internet.

I will give you a hint..

Short term assets:

cash on hand
cash in bank

Marketable securities

accounts receivable
(Less: allowance for doubtful accounts) this is a contra asset

short term prepayments of expenses (called prepaid assets)

Inventories

Total Short term assets:_____________

Long term assets
Long term advance receivable from affiliated compnay

Fixed Assets:
Building and equipment
Less:(accumulated depreciation) this is a contra asset

Total Fixed assets ___________________


Intangible Assets

Patents

note I'm not sure if the cash surrender value is actually classifed as an asset


Liabilities

Short term liabilities
accounts payable
income taxes payable
current instalment of long term debt payable

Long term Liabilities
7% note payable long term portion


Total Liabilities __________________


EQUITY

capital stock par $2 $100,000 (60,000 shares aut)
paid in capital in excess of par
Retained Earnings (R/E)


Income statement items that will not show on the balance sheet are discontinued operatiional loss, error in inventory pricing, depreciation expense, dividends received as revenue, sales, and uncollectible account expense.

The two items I am not 100% sure about are the cash surrender value of insurance policy..I can't recall if this is listed as an intangible or not..maybe look this up.

Also, the wording of the accounts receivable net of the
credit balances is throwing me off a little bit because its like 2 AM where I am

If you fill in my template..you will get an A+ for sure :)

Allowance for doubtful accounts and accumulated depreciation are "contra asset" accounts and are subtracted from the balance sheet assets. The corresponding Expense items are Uncollecitible Account EXPENSE and Depreciation EXPENSE and these appear on the INCOME statment

in the equity section dont let the wording confuse you..you know the par per share is $2..and the value is 100,000
. The fact that they are saying 60,000 authorized is irrelevant.
in calculating the amount. You just know that 50,000 were issued at a par value of $2=100,000

So what is the "paid in capital in excess of par"...well this just means that when the company actually SOLD the shares..they sold them for more than $2... so the origianl jornal entry for share sales would have been


D)CASH 100,000+155,200
cr )paid in capital in excess of par 155,200
cr )par $2 shares, 50000 issued, 60000 auth $100000