Question

1. Using the following information, prepare a classified balance sheet for ABC Company as at 31 December, 2019:

Inventories $30,000 Plant and equipment $60,000 Short-term borrowings $10,000 Trade payables $40,000 Long-term borrowings $124 ,000 Property $150,000 Motor Vehicle $30,000 Trade receivables $45,000 Cash $10,000 Equity at Dec 31, 2014 $151,000 Drawings $15,000 Profit $15,000 Determine: 1- Non-current Assets 2- Current Assets 3- Non-current Liabilities 4- Current Liabilities 5- Total Equity 6- Total Assets

Answer 1

Balance sheet of ABC company

ASSETS	Amount
Current assets:
Inventories	30000
Cash	10000
Trade receivables	45000
Total current assets	85000
Non Current assets:
Plant and equipment	60000
Property	150000
Motor Vehicle	30000
Net fixed assets	240000
Total Assets	325000
LIABILITIES AND EQUITY
Current liabilities:
Short-term borrowings	10000
Trade payables	40000
Total current liabilities	50000
Long-term borrowings	124000
Total current and long-term liabilities	174000
Shareholders’ equity:
Equity	151000
Profit	15000
Drawings	-15000
Total shareholders’ equity	151000
Total Equit and Liabilities	325000

Current asset are those which are expected to be realised in near future

Current liabilities are those which are expected to be paid in near future

Non-current Assets are thoes which are not intended to be sold off in near future and from which future economic benefits are expected

Non-current Liabilities are thoes which are not expected to be paid off in near future

Total Equity represents owner capital, drawings are deducted from it