Question

The following accounts and account balances have been extracted from the accounting records of Catalina’s Guatemalan Antiques, Inc at December 31, 2009. Balance Unearned rent revenue $ 15,500 Buildings 250,000 Inventory 7,500 Bonds payable (due in 2012) 200,000 Accounts payable 27,500 Note payable to bank due in 90 days 50,000 Retained Earnings (ending) 85,000 Premium on common stock (paid-in capital in excess of par) 75,000 Investment in stock of another company; intent is to hold long-term 50,000 Accounts receivable 46,000 Land used in the business as a plant site 100,000 Rent prepaid for next 12 months 4,800 Certificate of deposit with a bank (matures in 8 months) 32,000 Copyright 125,000 Cash in checking account 22,000 Accumulated depreciation – Buildings 25,000 Land held for future plant site (speculation) 50,000 Salaries and wages payable 6,700 Common Stock 200,000 Allowance for doubtful accounts 2,600

Construct a classified balance sheet in good form for Catalina’s for 2009.

Answer 1

Catalina’s Guatemalan Antiques, Inc.
Balance Sheet
December 31, 2009
Assets
Current Assets
Cash		$       22,000
Certificate of Deposit		$       32,000
Accounts receivable	$      46,000
Less allowance for doubtful accounts	$      (2,600)	$       43,400
Inventory		$         7,500
Prepaid Rent		$         4,800
Total current assets			$   109,700
Long-term investments
Stock investments		$       50,000
Land held for future plant site		$       50,000
Total long-term investments			$   100,000
Property, plant and equipment
Buildings	$    250,000
Less accumulated depreciation - Buildings	$    (25,000)	$     225,000
Land used as a Plant Site		$     100,000
Total PPE			$   325,000
Intangible assets
Copyrights			$   125,000
Total assets			$   659,700
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable		$       27,500
Notes payable		$       50,000
Salaries and wages payable		$         6,700
Unearned rent revenue		$       15,500
Total current liabilities			$     99,700
Long-term debt
Bonds payable, due in three years			$   200,000
Total liabilities			$   299,700
Stockholders' equity
Capital stock
Common stock	$    200,000
Additional paid-in capital:
Premium on common stock	$      75,000
Total paid-in capital		$ 275,000
Retained earnings		$   85,000
Total stockholders' equity			$   360,000
Total liabilities and stock-holders equity			$   659,700