Question

Presented below are the captions of Faulk Company’s balance sheet. Indicate where each of the following items would be classified.

		Balance Sheet Accounts		Balance Sheet Classification
1.		Preferred stock.		select a classification                                                          Retained EarningsOther AssetsNonCurrent LiabilitiesAdditional Paid-in CapitalProperty, Plant, and EquipmentInvestmentsCurrent AssetsCurrent LiabilitiesIntangible AssetsCapital Stock
2.		Goodwill.		select a classification                                                          Current AssetsRetained EarningsCapital StockInvestmentsOther AssetsCurrent LiabilitiesIntangible AssetsNonCurrent LiabilitiesProperty, Plant, and EquipmentAdditional Paid-in Capital
3.		Salaries and wages payable		select a classification                                                          Property, Plant, and EquipmentIntangible AssetsRetained EarningsCapital StockInvestmentsOther AssetsCurrent AssetsCurrent LiabilitiesAdditional Paid-in CapitalNonCurrent Liabilities
4.		Accounts payable.		select a classification                                                          NonCurrent LiabilitiesRetained EarningsCapital StockCurrent AssetsCurrent LiabilitiesInvestmentsIntangible AssetsOther AssetsAdditional Paid-in CapitalProperty, Plant, and Equipment
5.		Buildings.		select a classification                                                          Intangible AssetsOther AssetsCapital StockProperty, Plant, and EquipmentInvestmentsAdditional Paid-in CapitalRetained EarningsNonCurrent LiabilitiesCurrent AssetsCurrent Liabilities
6.		Equity investments (to be sold within one year).		select a classification                                                          Other AssetsIntangible AssetsNonCurrent LiabilitiesCurrent LiabilitiesCurrent AssetsAdditional Paid-in CapitalProperty, Plant, and EquipmentInvestmentsRetained EarningsCapital Stock
7.		Current maturity of long-term debt.		select a classification                                                          Current LiabilitiesNonCurrent LiabilitiesOther AssetsRetained EarningsCurrent AssetsInvestmentsCapital StockAdditional Paid-in CapitalIntangible AssetsProperty, Plant, and Equipment
8.		Premium on bonds payable.		select a classification                                                          Retained EarningsIntangible AssetsProperty, Plant, and EquipmentNonCurrent LiabilitiesCapital StockInvestmentsOther AssetsCurrent LiabilitiesCurrent AssetsAdditional Paid-in Capital
9.		Allowance for doubtful accounts.		select a classification                                                          Retained EarningsNonCurrent LiabilitiesIntangible AssetsCapital StockAdditional Paid-in CapitalCurrent AssetsOther AssetsCurrent LiabilitiesProperty, Plant, and EquipmentInvestments
10.		Accounts receivable.		select a classification                                                          Other AssetsCurrent AssetsInvestmentsCurrent LiabilitiesAdditional Paid-in CapitalRetained EarningsCapital StockIntangible AssetsNonCurrent LiabilitiesProperty, Plant, and Equipment
11.		Cash surrender value of life insurance.		select a classification                                                          NonCurrent LiabilitiesIntangible AssetsCurrent LiabilitiesOther AssetsInvestmentsCurrent AssetsProperty, Plant, and EquipmentRetained EarningsAdditional Paid-in CapitalCapital Stock
12.		Notes payable (due next year).		select a classification                                                          NonCurrent LiabilitiesInvestmentsOther AssetsProperty, Plant, and EquipmentAdditional Paid-in CapitalCurrent AssetsRetained EarningsIntangible AssetsCurrent LiabilitiesCapital Stock
13.		Supplies.		select a classification                                                          Other AssetsAdditional Paid-in CapitalCurrent AssetsNonCurrent LiabilitiesProperty, Plant, and EquipmentCurrent LiabilitiesCapital StockRetained EarningsInvestmentsIntangible Assets
14.		Common stock.		select a classification                                                          InvestmentsCurrent AssetsOther AssetsAdditional Paid-in CapitalProperty, Plant, and EquipmentRetained EarningsCapital StockCurrent LiabilitiesIntangible AssetsNonCurrent Liabilities
15.		Land.		select a classification                                                          Intangible AssetsNonCurrent LiabilitiesRetained EarningsOther AssetsProperty, Plant, and EquipmentCapital StockInvestmentsCurrent LiabilitiesCurrent AssetsAdditional Paid-in Capital
16.		Bond sinking fund.		select a classification                                                          Current LiabilitiesNonCurrent LiabilitiesInvestmentsAdditional Paid-in CapitalRetained EarningsProperty, Plant, and EquipmentCapital StockOther AssetsCurrent AssetsIntangible Assets
17.		Inventory.		select a classification                                                          Current AssetsIntangible AssetsProperty, Plant, and EquipmentCurrent LiabilitiesCapital StockRetained EarningsNonCurrent LiabilitiesOther AssetsInvestmentsAdditional Paid-in Capital
18.		Prepaid insurance.		select a classification                                                          Other AssetsCapital StockNonCurrent LiabilitiesProperty, Plant, and EquipmentCurrent LiabilitiesIntangible AssetsAdditional Paid-in CapitalInvestmentsRetained EarningsCurrent Assets
19.		Bonds payable.		select a classification                                                          Current LiabilitiesInvestmentsProperty, Plant, and EquipmentCurrent AssetsCapital StockOther AssetsNonCurrent LiabilitiesRetained EarningsIntangible AssetsAdditional Paid-in Capital
20.		Income taxes payable.		select a classification                                                          Property, Plant, and EquipmentCurrent AssetsOther AssetsInvestmentsRetained EarningsAdditional Paid-in CapitalCurrent LiabilitiesCapital StockNonCurrent LiabilitiesIntangible Assets

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Answer 1

Presented below are the captions of Faulk Company’s balance sheet. Indicate where each of the following items would be classified.

		Balance Sheet Accounts		Balance Sheet Classification
1.		Preferred stock.		Capital Stock
2.		Goodwill.		Intangible assets
3.		Salaries and wages payable		Current liabilities
4.		Accounts payable.		Current liabilities
5.		Buildings.		Property, plant and equipment
6.		Equity investments (to be sold within one year).		Current assets
7.		Current maturity of long-term debt.		Current liabilities
8.		Premium on bonds payable.		Non Current liabilities
9.		Allowance for doubtful accounts.		Current assets (contra)
10.		Accounts receivable.		Current assets
11.		Cash surrender value of life insurance.		Other assets
12.		Notes payable (due next year).		Current liabilities
13.		Supplies.		Current assets
14.		Common stock.		Capital Stock
15.		Land.		Property, plant and equipment
16.		Bond sinking fund.		Non Current liabilities
17.		Inventory.		Current assets
18.		Prepaid insurance.		Current assets
19.		Bonds payable.		Non Current liabilities
20.		Income taxes payable.		Current liabilities