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Magazine Chapter 5: Q1P (page 248)
Question: P5-1 (L03) (Preparation of a Classified Balance Sheet, Periodic Inventory) Presented below is a list of accounts in alphabetical order.
Accounts Receivable Inventory鈥擡nding
Accumulated Depreciation鈥擝uildings Land
Accumulated Depreciation鈥擡quipment Land for Future Plant Site
Accumulated Other Comprehensive Income Loss from Flood
Advances to Employees Noncontrolling Interest
Advertising Expense Notes Payable (due next year)
Allowance for Doubtful Accounts Paid-in Capital in Excess of Par鈥� preferred stock
Bond Sinking Fund Patents
Bonds Payable Payroll Taxes Payable
Buildings Pension Liability
Cash (in bank) Petty Cash
Cash (on hand) Preferred Stock
Cash Surrender Value of Life Insurance Premium on Bonds Payable
Commission Expense Prepaid Rent
Common Stock Purchase Returns and Allowances
Copyrights Purchases
Debt Investments (trading) Retained Earnings
Dividends Payable Salaries and Wages Expense (sales)
Equipment Salaries and Wages Payable
Freight-In Sales Discounts
Gain on Disposal of Equipment Sales Revenue
Interest Receivable Treasury Stock (at cost)
Inventory鈥擝eginning Unearned Subscriptions Revenue
Instructions Prepare a classified balance sheet in good form. (No monetary amounts are to be shown.)
Short Answer
Answer
The company鈥檚 balance sheet reports only those accounts whose balances must be carried forward to next year.
Step by step solution
Definition of Off-Balance Sheet Items
The items that are not reported on the balance sheet of the company are known as off-balance sheet items. It includes items that are not directly owned by the business entity and liabilities towards which the business entity does not have a direct obligation.
Classified Balance sheet
Particular | Amount $ | Amount $ |
Assets | ||
Current assets: | ||
Cash (in bank) | ||
Cash (on hand) | ||
Other cash accounts (petty cash) | ||
Accounts receivables | ||
Less: allowance for doubtful accounts | ||
Inventory at end | ||
Prepaid rent | ||
Interest receivable | ||
Advance to employees | ||
Cash surrender value of life insurance | ||
Total current assets | ||
Long term investment: | ||
Debt investment | ||
Property, plant and equipment | ||
Land | ||
Building | ||
Less: Accumulated depreciation 鈥� building | ||
Equipment | ||
Less: Accumulated depreciation 鈥� equipment | ||
Intangible assets | ||
Patent | ||
Copyrights | ||
Total assets | ||
Liabilities and shareholder鈥檚 equity | ||
Current liabilities: | ||
Note payable | ||
Salaries and wages payable | ||
Dividend payable | ||
Payroll tax payable | ||
Unearned subscription payable | ||
Total current liabilities | ||
Non-Current liabilities | ||
Land held for future use | ||
Pension liability | ||
Bond sinking fund | ||
Bond payable | ||
Add: premium on bond payable | ||
Total non-current liabilities | ||
Stockholder鈥檚 equity: | ||
Preferred stock | ||
Common stock | ||
Additional paid-in preferred capital | ||
Less: Treasury stock | ||
Retained earnings | ||
Accumulated other comprehensive income | ||
Non-controlling interest | ||
Total stockholder鈥檚 equity |
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