Question

The statement of financial position of Swifty Corporation follows for the current year, 2020:

SWIFTY CORPORATION Statement of Financial Position December 31, 2020
Current assets		$504,400		Current liabilities		$395,200
Investments		665,600		Long-term liabilities		998,400
Property, plant, and equipment		1,788,800		Shareholders' equity		1,840,800
Intangible assets		275,600
		$3,234,400				$3,234,400

The following additional information is available:

1.		The current assets section includes the following: cash $156,000; accounts receivable $176,800, less $10,400 allowance for doubtful accounts; inventory $187,200; and unearned revenue $5,200. The cash balance is composed of $197,600, less a bank overdraft of $41,600 (at a separate financial institution). Inventory is stated at the lower of FIFO cost and net realizable value.
2.		The investments section includes the following: note receivable from a related company, due in 2026, $41,600; FV-NI investments in shares $83,200 (fair value $83,200); FV-OCI investments in shares $130,000 (fair value $161,200); bond sinking fund $260,000; and patents $119,600, net of accumulated amortization.
3.		Property, Plant, and Equipment include buildings $1,081,600, less accumulated depreciation $374,400; equipment $468,000, less accumulated depreciation $187,200; land $520,000; and land held for future use $280,800.
4.		Intangible Assets include franchise, net of accumulated amortization, $275,600.
5.		Current liabilities include the following: accounts payable $145,600; notes payable, short-term $83,200, long-term $124,800; and income tax payable $41,600.
6.		Long-term liabilities are composed solely of 7% bonds payable issued at a discount, due in 2028.
7.		Shareholders' equity has 70,000 preferred shares (200,000 authorized), which were issued for $468,000, and 104,000 common shares (unlimited number authorized), which were issued at an average price of $10 per share. In addition, the corporation has retained earnings of $301,600 and accumulated other comprehensive income of $31,200.

(a)

Prepare a statement of financial position in good form. (Adjust the amounts in each SFP classification based on the additional information.)

Answer 1

Balance Sheet as on December 31, 2020:
Assets		Amount $
Current Assets:
Cash	197600
Accounts Recivable	176800
Allowance for doubtful accounts	-10400
Inventory (Lower of FIFO cost or Net realisable value)	187200
Total Current Assets		551200
Investments:
Note receivable	41600
FV-NI shares (at fair value)	83200
FV-OCI shares (at fair value)	161200
Bond sinking fund	260000
Patents	119600
Total Investment		665600
Property, Plant and Equipment:
Land	520000
Land for future use	280800
Building	1081600
Less:Acc. Dep. - Building	-374400
Equipment	468000
Less:Acc. Dep. - Equipment	-187200
Total PPE:		1788800
Intangible Assets:
Franchise (net)		275600
Total Assets		3281200
Liabilities & Stockholders' Equity		Amount $
Current Liabilities:
Accounts payable	145600
Notes payable-ST	83200
Income Tax payable	41600
Bank Overdraft	41600
Unearned revenue	5200
Total Current Liabilities		317200
Long term Liabilities:
Notes payable	124800
7% Bonds payable	998400
Total Long term liabilities		1123200
Shareholders' Equity:
Preferred Shares:
Authorised 200000 shares
Issued 70000 shares	468000
Common Shares:
Authorised: Unlimited
Issued 104000 @ $10 per share	1040000
Retained Earnings	301600
Accumulated other comprehensive income:
Unearned Income (investment fair valuation)	31200
Total Shareholders' Equity		1840800
Total Liabilities and Stockholders' Equity		3281200