Question

In: Accounting

Midway, Inc. December 31, 2014 Goodwill 128,730 Accumulated Depreciation-Equipment 292,200 Payroll Taxes Payable 181,321 Inventory 243,530...

Midway, Inc.
December 31, 2014
Goodwill 128,730 Accumulated Depreciation-Equipment 292,200
Payroll Taxes Payable 181,321 Inventory 243,530
Bonds payable 303,730 Rent payable (short-term) 48,730
Discount on bonds payable 15,200 Income taxes payable 102,092
Cash 363,730 Rent payable (long-term) 483,730
Land 483,730 Common stock, $1 par value 203,730
Notes receivable 449,430 Preferred stock, $10 par value 153,730
Notes payable (to banks) 268,730 Prepaid expenses 91,650
Accounts payable 493,730 Equipment 1,473,730
Retained earnings ? Debt investments (trading) 124,730
Income taxes receivable 101,360 Accumulated Depreciation-Buildings 270,400
Notes payable (long-term) 1,603,730 Buildings 1,643,730
Prepare a classified balance sheet in good form. Assume that notes receivable and notes payable are
short-term, unless stated otherwise. Cost and fair value of equity investments (trading) are the same.

Solutions

Expert Solution

1

Midway, Inc., INC.

Balance Sheet

December 31, 2014

Assets

Current assets

Cash

$363,730

Equity Investments (Trading)

124,730

Notes Receivable

449,430

Income Taxes Receivable

101,360

Inventory

243,530

Prepaid Expenses

91,650

Total current assets

$1,374,430

Property, plant, and equipment

Land

483,730

Buildings

$1,643,730

Less: Accum Deprec - Buildings

270,400

1,373,330

Equipment

1,473,730

Less: Accum Deprec - Equipment

292,200

1,181,530

3,038,590

Intangible assets

Goodwill

128,730

Total assets

$4,541,750

Liabilities and Shareholders’ Equity

Current liabilities

Accounts Payable

$493,730

Notes Payable to Banks

268,730

Payroll Taxes Payable

181,321

Income Tax Payable

102,092

Rent Payable - Short-term

48,730

Total current liabilities

$1,094,603

Long-term liabilities

Unsecured Notes Payable (Long-term)

1,603,730

Bonds Payable

$303,730

Less: Discount on Bonds Payable

15,200

288,530

Rental Payable Long-term

483,730

2,375,990

Total liabilities

3,470,593

Shareholders’ equity

Capital Stock

Preferred stock,       $10 par; shares

153,730

Common stock, $1 par

203,730

357,460

Retained Earnings ($1,071,157 - $357,460)

713,697

Total shareholders’ equity ($4,541,750 – $3,470,593)

1,071,157

Total liabilities and shareholders’ equity

$4,541,750

working notes for the above answer is as under

1

Computation of Retained earnings:

Total assets

$4,541,750

Less: Liabilities

3,470,593

Less: Contributed capital

357,460

Retained earnings

$713,697


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