Question

Listed below are year-end account balances ($ in millions) taken from the records of Symphony Stores. Debit Credit Accounts receivable–trade 730 Building and equipment 920 Cash–checking 34 Interest receivable 30 Inventory 16 Land 150 Notes receivable (long-term) 450 Petty cash fund 5 Prepaid rent 20 Supplies 8 Trademark 40 Accounts payable–trade 560 Accumulated depreciation 80 Additional paid-in capital 485 Allowance for uncollectible accounts 20 Cash dividends payable 30 Common stock, at par 15 Income tax payable 65 Notes payable (long-term) 800 Retained earnings 308 Deferred revenues 40 TOTALS 2,403 2,403 What would Symphony report as total assets?

Answer 1

Answer:

TOTAL ASSETS  $2,303,000

Explanation:

Some

Symphony Balance Sheet

$39,000  Cash

$710,000 Accounts Receivable

$20,000  Prepaid Rent

$30,000  Interest Receivable

$8,000    Supplies

$16,000   Inventory

$823,000  TOTAL CURRENT ASSETS  

$920,000 Building and Equipment

-$80,000 Accum Depreciation

$40,000  Trademark

$450,000 Notes Receivable

$150,000 Land

$1480,000  TOTAL NONCURRENT ASSETS  

$2303,000  TOTAL ASSETS  

$560,000  Accounts Payable  

$30,000  Cash Dividend Payable

$40,000   Deferred Revenue  

$65,000  Income Tax Payable

$695,000 TOTAL CURRENT LIABILITIES  

$800,000  Notes Payable  

$800,000  TOTAL NONCURRENT LIABILITIES  

$1495,000  TOTAL LIABILITIES  

$485,000  Additional Paid in Capital  

$15,000    Common Stock  

$308,000  Retained Earnings  

$808,000  TOTAL EQUITY  

$2303,000  TOTAL EQUITY + LIABILITIES  

Some reclassification are needed to do before report the total Assets

Allowance for uncollectible accounts are deduct of the total amount of accounts receivables

Petty Cash Fund is the same as Cash with the difference that this funds have an specific use as minor expenditures.

Account of Current Assets , the criteria is to have a liquidity speed less of one year

Cash and Petty Cash Fund

Accounts Receivable less Allowance for uncollectible accounts

Prepaid Rent

Interest Receivable

Supplies

Inventory

Account of Non Current Assets , the criteria is to have a liquidity speed more than one year and are known as fixed assets

Building and Equipment

Accum Depreciation

Trademark

Notes Receivable

Land

Account of Current Liabilities , the criteria is to have a liquidity speed less of one year

Accounts Payable  

Cash Dividend Payable

Deferred Revenue  

Income Tax Payable

Account of Non Current Liabilities, the criteria is to have a liquidity speed more than one year and are known as long term financing

Notes Payable  

Account of Total Equity

Additional Paid in Capital  

Common Stock  

Retained Earnings