Question

In: Accounting

what order should assets appear on the balance sheet?

what order should assets appear on the balance sheet?

Solutions

Expert Solution

Solution:
In order of liquidity assets should appeared on the balance sheet
Liquidity means how easily they can be converted into cash, like cash do not need to convert, then the marketable securities and so on.
Assets order on the balance sheet in the order of liquidity are:
1st Cash
2nd Marketable securities
3rd Accounts receivable
4th Inventory.
5th Fixed assets
6th Goodwill or intangible assets
In other words , assets on balance sheet are in order of current assets , investment, fixed assets at last intangibles, and in current assets , assets are in the order of how fast they can be converted into cash.

Related Solutions

In what section of the balance sheet should the following items appear, and what balance sheet terminology would you use?
In what section of the balance sheet should the following items appear, and what balance sheet terminology would you use? (a) Treasury stock (recorded at cost). (b) Checking account at bank. (c) Land (held as an investment). (d) Sinking fund. (e) Unamortized premium on bonds payable. (f) Copyrights. (g) Pension fund assets. (h) Premium on common stock. (i) Long-term investments (pledged against bank loans payable).
The current assets and current liabilities sections of the balance sheet of Crane Company appear as...
The current assets and current liabilities sections of the balance sheet of Crane Company appear as follows. CRANE COMPANY BALANCE SHEET (PARTIAL) DECEMBER 31, 2020 Cash $ 41,300 Accounts payable $  58,430 Accounts receivable $96,300 Notes payable 63,280     Less: Allowance for doubtful accounts 7,840 88,460 $121,710 Inventory 169,820 Prepaid expenses 8,620 $308,200 The following errors in the corporation’s accounting have been discovered: 1. January 2021 cash disbursements entered as of December 2020 included payments of accounts payable in the amount of...
The current assets and current liabilities sections of the balance sheet of Marin Company appear as...
The current assets and current liabilities sections of the balance sheet of Marin Company appear as follows. MARIN COMPANY BALANCE SHEET (PARTIAL) DECEMBER 31, 2017 Cash $ 46,100 Accounts payable $  56,560 Accounts receivable $95,900 Notes payable 67,760     Less: Allowance for doubtful accounts 8,850 87,050 $124,320 Inventory 163,710 Prepaid expenses 9,840 $306,700 The following errors in the corporation’s accounting have been discovered: 1. January 2018 cash disbursements entered as of December 2017 included payments of accounts payable in the amount of...
What is the total amount of property, plant, and equipment that will appear on the Balance Sheet?
These are selected account balances on December 31, 2017: Land (location of the corporation’s office building) $400,000, Land held for investment $600,000, Office Building $2,900,000, Inventory $800,000, Equipment $1,800,000, Office Furniture $400,000, Accumulated Depreciation $1,200,000. What is the total amount of property, plant, and equipment that will appear on the Balance Sheet? $5,700,000 $6,900,000 $4,300,000 $4,900,000
What determines the order of the information shown on the balance sheet and why is order...
What determines the order of the information shown on the balance sheet and why is order important? Which of the numbers in the income statement is considered to be most important? Why? What effect can improper and illegal actions of a firm have on the financial statements, stock prices, and the entire global economy?
Bank A Balance Sheet Assets                                     &nbsp
Bank A Balance Sheet Assets                                      Liabilities                           Reserves         $60 million      Deposits   $600 million Loans           $640 million      Capital     $100 million Bank B Balance Sheet Assets                                      Liabilities                           Reserves         $90 million      Deposits   $600 million Loans           $610 million      Capital     $100 million Assume the Required Reserve Ratio is 10% as mandated by the Fed. Both banks are free to keep required reserves in accordance with their respective bank policies. If both banks suffer a $10 million deposit outflow, which bank is in a better shape now, Bank A or Bank B? Why? Explain your answer by showing and usingboth banks’...
What are current assets? How are they shown on the balance sheet? What are non-current assets?...
What are current assets? How are they shown on the balance sheet? What are non-current assets? How are they shown on the balance sheet?
The financial statements of Hainz Company appear below: HAINZ COMPANY Comparative Balance Sheet December 31 Assets...
The financial statements of Hainz Company appear below: HAINZ COMPANY Comparative Balance Sheet December 31 Assets      2015                    2014    Cash.............................................................     $  20,000             $ 40,000 Short-term investments............................         20,000                 60,000 Accounts receivable (net)..........................         40,000                 30,000 Inventory.....................................................         60,000                 70,000 Property, plant and equipment (net).......       260,000               300,000       Total assets ..........................................     $400,000             $500,000 Liabilities and stockholders' equity Accounts payable......................................     $  20,000             $ 30,000 Short-term notes payable........................         40,000                 90,000 Bonds payable...........................................         80,000               160,000 Common stock..........................................       150,000               150,000 Retained earnings.....................................       110,000                 70,000 Total liabilities and stockholders' equity.  $400,000             $500,000                                                                  HAINZ COMPANY Income Statement For the Year Ended December 31, 2015 Net sales................................................................................    $400,000 Cost of...
Calculate total current assets and total current liabilities that would appear in the company’s year-end balance sheet.
The trial balance for K and J Nursery, Inc., listed the following account balances at December 31, 2018, the end of its fiscal year:cash, $16,000accounts receivable, $11,000inventories, $25,000equipment (net), $80,000accounts payable, $14,000wages payable, $9,000interest payable, $1,000note payable (due in 18 months), $30,000common stock, $50,000Calculate total current assets and total current liabilities that would appear in the company’s year-end balance sheet.
The financial statements of Amy Inc. appear below: Amy Inc Comparative Balance Sheet December 31, Assets...
The financial statements of Amy Inc. appear below: Amy Inc Comparative Balance Sheet December 31, Assets 2020 2019 Cash....................................................................................... $ 36,000 $ 33,000 Short-term investments .......................................................... 28,000 30,000 Accounts receivable (net)....................................................... 80,000 60,000 Supplies ................................................................................. 8,000 10,000 Inventories.............................................................................. 115,000 80,000 Prepaid Expenses .................................................................. 6,000 5,000 Property, plant and equipment (net)....................................... 297,000 218,000 Total assets ..................................................................... $570,000 $436,000 Liabilities and stockholders' equity Accounts payable................................................................... $ 87,000 $ 73,000 Short-term notes payable ....................................................... 15,000 17,000 Long-term bonds payable....................................................... 80,000 20,000 Common stock,...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT