In: Accounting
These items are taken from the financial statements of Sandhill
Co. at December 31, 2022.
Buildings | $126,960 | |
Accounts receivable | 15,120 | |
Prepaid insurance | 3,840 | |
Cash | 14,208 | |
Equipment | 98,880 | |
Land | 73,440 | |
Insurance expense | 936 | |
Depreciation expense | 6,360 | |
Interest expense | 3,120 | |
Common stock | 72,000 | |
Retained earnings (January 1, 2022) | 48,000 | |
Accumulated depreciation—buildings | 54,720 | |
Accounts payable | 11,400 | |
Notes payable | 112,320 | |
Accumulated depreciation—equipment | 22,464 | |
Interest payable | 4,320 | |
Service revenue | 17,640 |
Prepare a classified balance sheet. Assume that $16,320 of the note
payable will be paid in 2023. (List Current Assets in
order of liquidity and Property, Plant and Equipment in order of
Land, Buildings and Equipment.)
The classified balance sheet is shown following the trial balance and income statement.
Trial balance total = $ 342,864
Net Income = $ 7,224
Balance sheet total = $ 255,264
Notes:-
1. Notes Payable are classified as Current Liabilities when the amounts are due within a year.
2. When Note's maturity is more than one year in the future, it is classified as Long- term Liabilities.
So, in this question Notes payable in
Current Liability = $ 96,000
Long- term Liabilities = $ 16,320