Question

Presented below is the balance sheet of Maggie Corporation for the current year, 2017.

MAGGIE CORPORATION BALANCE SHEET DECEMBER 31, 2017
Current assets		$  487,550		Current liabilities		$  382,550
Investments		642,550		Long-term liabilities		1,002,550
Property, plant, and equipment		1,722,550		Stockholders’ equity		1,772,550
Intangible assets		305,000				$3,157,650
		$3,157,650

The following information is presented.

1.		The current assets section includes cash $152,550, accounts receivable $172,550 less $12,550 for allowance for doubtful accounts, inventories $182,550, and unearned rent revenue $7,550. Inventory is stated on the lower-of-FIFO-cost-or-market.
2.		The investments section includes the cash surrender value of a life insurance contract $42,550; investments in common stock, short-term $82,550 and long-term $272,550; and bond sinking fund $244,900. The cost and fair value of investments in common stock are the same.
3.		Property, plant, and equipment includes buildings $1,042,550 less accumulated depreciation $362,550, equipment $452,550 less accumulated depreciation $182,550, land $502,550, and land held for future use $270,000.
4.		Intangible assets include a franchise $167,550, goodwill $102,550, and discount on bonds payable $34,900.
5.		Current liabilities include accounts payable $142,550, notes payable-short-term $82,550 and long-term $122,550, and income taxes payable $34,900.
6.		Long-term liabilities are composed solely of 7% bonds payable due 2025.
7.		Stockholders’ equity has preferred stock, no par value, authorized 200,000 shares, issued 72,550 shares for $435,300, and common stock, $1.00 par value, authorized 400,000 shares, issued 102,550 shares at an average price of $10. In addition, the corporation has retained earnings of $311,750.

Prepare a balance sheet in good form, adjusting the amounts in each balance sheet classification as affected by the information given above. (List Current Assets in order of liquidity. List Property, Plant and Equipment in order of Land, Building and Equipment. Enter account name only and do not provide the descriptive information provided in the question.)

MAGGIE CORPORATION

Answer 1

MAGGIE CORPORATION
BALANCE SHEET
DECEMBER 31 2017
Particulars	$	$	$
Current Assets
Cash		152550
Equity investments (trading)		82550
Accounts receivable	172550
Less: Allowance for doubtful accounts	-12550	160000
Inventory (lower of FIFO or cost)		182550
Total Current assets			577650
Long term investments
Equity investments (available for sale) at fair value		272550
Bond sinking fund		244900
Cash surrender value of life insurance		42550
Land held for future use		270000	830000
Property plant and equipment
Land		502550
Buildings	1042550
Less: Accumulated Dep	-362550	680000
Equipment	452550
Less: Accumulated Dep	-182550	270000	1452550
Intangible assets:
Franchise		167550
Goodwill		102550	270100
Total assets			3130300
Liabilities and stockholders' equity
Accounts Payable		142550
Notes Payable		82550
Income taxes Payable		34900
Unearned rent revenue		7550
Total current liabilities			267550
Long term liabilities
Notes Payable		122550
7% Bond payable due 2022	1002550
Less: Discounts on bond payable	-34900	967650	1090200
Total liabilities			1357750
Stockholders' equity
Capital stock
Preferred stock, no par value
200,000 shares authorized
72550 issued and outstanding	435300
Common stock $1 par value
400,000 shares authorized
102550 shares issued and outstanding	102550
Paid in capital in excess of par - common stock
[102550*($10-$1)]	922950	1460800
Retained earnings		311750
Total stock holder's equity			1772550
Total liabilities and stockholders’ equity			3130300