Question

The following is the ending balances of accounts at December 31, 2018 for the Weismuller Publishing Company.

Account Title	Debits			Credits
Cash		73,000
Accounts receivable		168,000
Inventories		289,000
Prepaid expenses		156,000
Machinery and equipment		328,000
Accumulated depreciation—equipment				114,000
Investments		148,000
Accounts payable				64,000
Interest payable				24,000
Deferred revenue				84,000
Taxes payable				34,000
Notes payable				220,000
Allowance for uncollectible accounts				20,000
Common stock				404,000
Retained earnings				198,000
Totals		1,162,000		1,162,000

Additional information:

Prepaid expenses include $128,000 paid on December 31, 2018, for a two-year lease on the building that houses both the administrative offices and the manufacturing facility.

Investments include $34,000 in Treasury bills purchased on November 30, 2018. The bills mature on January 30, 2019. The remaining $114,000 includes investments in marketable equity securities that the company intends to sell in the next year.

Deferred revenue represents customer prepayments for magazine subscriptions. Subscriptions are for periods of one year or less.

The notes payable account consists of the following:

a $44,000 note due in six months.

a $104,000 note due in six years.

a $72,000 note due in three annual installments of $24,000 each, with the next installment due August 31, 2019.

The common stock account represents 404,000 shares of no par value common stock issued and outstanding. The corporation has 600,000 shares authorized.

Required:
Prepare a classified balanced sheet for the Weismuller Publishing Company at December 31, 2018. (Amounts to be deducted should be indicated by a minus sign.)

Answer 1

Prepare the balance sheet as follows:

Weismuller Publishing Company
Balance Sheet
December 31, 2018
Assets
Current Assets:
Cash and cash equivalents		107000
Short-term investments		114000
Accounts receivable	168000
Allowance for uncollectible accounts	-20000
Accounts receivable, net		148000
Inventories		289000
Prepaid expenses		92000
Total current assets			750000
Property, Plant and Equipment:
Machinery and equipment		328000
Accumulated depreciation - equipment		-114000
Total property, plant and equipment			214000
Other Assets:
Prepaid expenses		64000
Total other assets			64000
Total Assets			1028000
Liabilities and Stockholders' Equity
Current Liabilities:
Accounts payable		64000
Interest payable		24000
Deferred revenue		84000
Taxes payable		34000
Notes payable (current)		68000
Total current liabilities			274000
Long-Term Liabilities:
Notes payable		152000
Total long-term liabilities			152000
Total liabilities			426000
Stockholders' Equity:
Common Stock, no par value, 600,000 shares authorized, 404,000 shares issued and outstanding		404000
Retained earnings		198000
Total stockholders' equity			602000
Total Liabilities and Stockholders' Equity			1028000