Question

Presented below is the adjusted trial balance of Larkspur Corporation at December 31, 2017.

	Debit		Credit
Cash	$          ?
Supplies	1,300
Prepaid Insurance	1,100
Equipment	48,100
Accumulated Depreciation-Equipment			$  4,100
Trademarks	1,050
Accounts Payable			10,100
Salaries and Wages Payable			600
Unearned Service Revenue			2,100
Bonds Payable (due 2024)			9,100
Common Stock			10,100
Retained Earnings			25,100
Service Revenue			10,100
Salaries and Wages Expense	9,100
Insurance Expense	1,500
Rent Expense	1,300
Interest Expense	1,000
Total	$          ?		$          ?

Additional information:

1.		Net loss for the year was $2,800.
2.		No dividends were declared during 2017.

Prepare a classified balance sheet as of December 31, 2017. (List Current Assets in order of liquidity.)

Answer 1

Working Note :

• We know that Total Debit of Trial Balance = Total Credit of Trial Balance

Required Cash balance + $64,450 = $71,300

Required Cash balance =  $71,300 - $64,450 = $6,850

Answer

LARKSPUR CORPORATION

Balance Sheet

December 31, 2017.

	Amount ($)	Amount ($)
Assets
Current Assets :
Cash	6,850
Supplies	1,300
Prepaid Insurance	1,100
Total Current Assets		9,250
Equipment	48,100
Accumulated Depreciation-Equipment	(4,100)	44,000
Trademarks		1,050
Total Assets		$54,300
Liabilities & Shareholder's Equity
Current Liabilities
Accounts Payable	10,100
Salaries and Wages Payable	600
Unearned Service Revenue	2,100
Total Current Liabilities		12,800
Bonds Payable		9,100
Total Liabilities		21,900
Shareholder's Equity
Common Stock	10,100
Retained Earnings [Note 1]	22,300
Total Shareholder's Equity		32,400
Total Liabilities & Shareholder's Equity		$54,300

Note 1

Retained Earnings Balance = Retained Earnings Beginning Balance - Net loss for the year

= $25,100 - $2,800 = $22,300