Question

Debit CreditCash $ 197,000Sales Revenue $ 8,100,000Debt Investments (trading) (at cost, $145,000) 153,000Cost of Goods Sold 4,800,000Debt Investments (long-term) 299,000Equity Investments (long-term) 277,000Notes Payable (short-term) 90,000Accounts Payable 455,000Selling Expenses 2,000,000Investment Revenue 63,000Land 260,000Buildings 1,040,000Dividends Payable 136,000Accrued Liabilities 96,000Accounts Receivable 435,000Accumulated Depreciation—Buildings 152,000Allowance for Doubtful Accounts 25,000Administrative Expenses 900,000Interest Expense 211,000Inventory 597,000Gain (extraordinary) 80,000Notes Payable (long-term) 900,000Equipment 600,000Bonds Payable 1,000,000Accumulated Depreciation—Equipment 60,000Franchises 160,000Common Stock ($5 par) 1,000,000Treasury Stock 191,000Patents 195,000Retained Earnings 78,000Paid-in Capital in Excess of Par 80,000 Totals $12,315,000 $12,315,000E5-12 (Preparation of a Balance Sheet) Presented below is the trial balance of Scott Butler Corporation at December 31, 2014.3InstructionsPrepare a balance sheet at December 31, 2014, for Scott Butler Corporation. (Ignore income taxes.)

Answer 1

• All working forms part of the answer
• First, the balance of Net Income that is to be transferred to retained earnings is to be computed in order to prepare balance Sheet

Revenues:
Sales Revenue	8100000
Investment revenue	63000
Gain (Extra ordinary)	80000
Total revenue (A)	$8243000
Expenses:
Cost of Goods Sold	4800000
Selling expenses	2000000
Administrative expense	900000
Interest expense	211000
Total expenses (B)	$7911000
Net Income transferred to retained Earnings (A - B)	$332000

• Balance Sheet, as asked is provided below

ASSETS		LIABILITIES & STOCKHOLDERS' EQUITY
Current Assets:	$	Current Liabilities:	$
Cash	197000	Notes Payable (short term)	90000
Debt Investments (trading)	153000	Accounts payable	455000
Accounts receivables, less Allowances $25000	410000	Dividends payable	136000
Inventory	597000	Accrued Liabilities	96000
Total Current Assets	1357000	Total Current Liabilities	777000
Long Term Assets:		Long Term Liabilities:
Buildings	1040000	Notes payable (Long term)	900000
Less: Accumulated Depreciation Building	-152000	Bonds Payable	1000000
Equipment	600000	Total Long Term Liabilities	1900000
Less: Accumulated Depreciation-Equipment	-60000
Land	260000	STOCKHOLDERS' EQUITY
Debt Instruments (long term)	299000	Common Stock ($5 par)	1000000
Equity Investments (long term)	277000	paid in capital in excess of Par	80000
Total Long Term Assets	2264000	Retained Earnings [78000+332000]	410000
		Total	1490000
Intangibles Assets:		Less: Treasury Stock	-191000
Franchises	160000	Total Stockholder's Equity	1299000
patents	195000
Total Intangible Assets	355000
TOTAL ASSETS	$3976000	TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$3976000