In: Accounting
XYZ Corporation |
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Adjusted Trial Balance |
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December 31, 2021 |
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Debit |
Credit |
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Accounts receivable |
700 |
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Building |
480 |
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Equipment |
375 |
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Cash |
125 |
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Inventory |
90 |
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Land |
300 |
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Notes receivable |
530 |
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Investments |
330 |
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Prepaid rent (for the next 2 years) |
50 |
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Supplies |
20 |
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Trademark |
50 |
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Prepaid Insurance (for the next 3 years) |
90 |
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Accounts payable |
620 |
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Accumulated depreciation- Equipment |
225 |
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Accumulated depreciation- Buildings |
180 |
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Total stockholders' equity |
1110 |
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Dividends payable |
50 |
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Income tax payable |
80 |
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Allowance for Doubtful Accounts |
55 |
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Notes payable |
600 |
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Interest payable |
60 |
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Deferred revenue |
160 |
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TOTALS |
3,140 |
3,140 |
Additional information and requirements:
Additional information: |
1. Land includes land held a possible future plant site $125K and land for the current plant site $175K. |
2. The notes receivable are due in 2023. The balance of $530 includes $30 of accrued interest. The next interest payment is due in July 2022. |
3. Included in the investments are treasury bills of $70K that were purchased in November 2021 and mature in January, 2022; trading securities of $100 which are expected to be sold within the next year. The balance represents securities expected to be held longer than one year. |
4. As of 12/31/21, Stockholders' equity has common stock, $1.00 par value, authorized 300K shares, and issued 150K shares at an average price of $4.50. The remaining balance in stockholders’ equity is retained earnings. |
5. The note payable represents a 12% note, with interest paid annually February 28. The note matures in installments of $100 beginning 2/28/22. |
6. Deferred revenue will be recognized equally over the next 24 months |
1.) Prepare a classified balance sheet for XYZ Corporation at
December 31, 2021. Complete the questions on the following page
about the balance sheet.
2.) Calculate the following ratios :
Current ratio = |
|
Debt to equity ratio = |
|
Acid-test (quick) ratio = |
|
Working capital = |
Please give positive ratings so I can keep answering. It would help me a lot. Please comment if you have any query. Thanks! |
XYZ Corporation | ||
Answer 1 | ||
Classified Balance Sheet | ||
Assets | Amount $ | Amount $ |
Current Assets | ||
Cash (including treasury bills) | 195.00 | |
Trading Securities | 100.00 | |
Accounts receivable | 700.00 | |
Allowance for uncollectible accounts | (55.00) | 645.00 |
Inventory | 90.00 | |
Supplies | 20.00 | |
Prepaid rent- current portion | 25.00 | |
Prepaid insurance- current portion | 30.00 | |
Interest receivable | 30.00 | |
Current Assets | 1,135.00 | |
Investments | ||
Long Term Investments | 160.00 | |
Notes receivable | ||
Non Current Assets | 160.00 | |
Plant, Property & Equipment | ||
Land | 300.00 | |
Building | 480.00 | |
Less: Accumulated Depreciation | (180.00) | 300.00 |
Equipment | 375.00 | |
Less: Accumulated Depreciation | (225.00) | 150.00 |
Plant, Property & Equipment | 750.00 | |
Intangible Assets | ||
Trademark | 50.00 | |
Franchise (net) | ||
Intangible Assets | 50.00 | |
Other Assets | ||
Notes receivable | 500.00 | |
Prepaid rent- Non current portion | 25.00 | |
Prepaid rent- current portion | 60.00 | |
Intangible Assets | 585.00 | |
Total Assets | 2,680.00 | |
Liabilities & Stockholder's Equity | ||
Liabilities | ||
Current Liabilities | ||
Accounts payable | 620.00 | |
Dividends payable | 50.00 | |
Interest payable | 60.00 | |
Income Taxes payable | 80.00 | |
Notes payable- Current Portion | 100.00 | |
Deferred Revenue- Current Portion | 80.00 | 60.00 |
Current Liabilities | 990.00 | |
Non Current Liabilities | ||
Notes payable | 500.00 | |
Unearned Revenue- Non Current Portion | 80.00 | |
Non Current Liabilities | 580.00 | |
Total Liabilities | 1,570.00 | |
Stockholder's Equity | ||
Common stock ( 330K of $ 1 par stock authorized, 150K shares issued and outstanding.) | 675.00 | |
Retained earnings | 435.00 | |
Total Stockholder's Equity | 1,110.00 | |
Total Liabilities & Stockholder's Equity | 2,680.00 |
Answer 2 | |
Current ratio | |
(Current Assets/ Current Liabilities) | 1.15 |
Debt to equity ratio | 1.41 |
(Total Liabilities/ Total Equity) | |
Quick assets | Amount $ |
Cash (including treasury bills) | 195.00 |
Trading Securities | 100.00 |
Accounts receivable (net( | 645.00 |
Interest receivable | 30.00 |
Quick assets | 970.00 |
Acid-test (quick) ratio | 0.98 |
(Quick assets/ Current Liabilities) | |
Working capital | 145.00 |
(Current Assets less Current Liabilities) |