Question

Problem 2:

Ginger Day is the sole owner of the Daytime Café. The balance sheet accounts for her café are shown below at the end of December 20X7.

Cash	$15,000
Prepaid insurance	10,000
Land	600,000
Accounts payable	12,000
Accounts receivable	6,000
Taxes payable	7,000
Mortgage payable- long term	800,000
Equipment	300,000
Buildings	600,000
Mortgage payable-current	50,000
Inventories	30,000
Wages payable	15,000
G. Day, Capital	??
Accumulated Depreciation	100,000

Prepare a classified balance sheet for Daytime Café. Note the amount of G.Day Capital is the difference between total assets and total liabilities.

Answer 1

Daytime Café
Balance Sheet
December 31, 20X7
Assets
Current Assets
Cash	15,000
Accounts Receivable	6,000
Inventories	30,000
Prepaid Insurance	10,000
Total current assets		61,000
Property, Plant & Equipment
Land	600,000
Building	600,000
Equipment	300,000
Less: Accumulated Depreciation	(100,000)
Total Property, Plant & Equipment		1,400,000
Total Assets		1,461,000
Liabilities and owner’s equity
Current Liabilities
Accounts Payable	12,000
Taxes Payable	7,000
Wages Payable	15,000
Mortage Payable	50,000
Total Current Liabilities	84,000
Long Term Liabilities
Mortgage Payable	800,000
Total Liabilities		884,000
Owner's Equity
G. Day, Capital		577,000
Total Liabilities and owner’s equity		1,461,000