Question

Information related to plant assets, natural resources, and intangibles at the end of 2020 for Kingbird, Inc. is as follows: buildings $1,150,000, accumulated depreciation—buildings $646,000, goodwill $450,000, coal mine $495,000, and accumulated depletion—coal mine $109,000. Prepare a partial balance sheet of Kingbird, Inc. for these items

Answer 1

Answer:

Kingbird, Inc

Balance Sheet (Partial) as on December 31, 2020

Fixed Assets

Building                                 $1,150,000

Accumulated Depreciation ($646,000)

Net book value of Building                          $504,000

Goodwill                                                        $450,000

Coal mine                              $495,000

Accumulated Depletion       ($109,000)

Net Value of Coal mine                                $386,000

Total Fixed Assets                                        $1,340,000

Explanation:

Fixed assets are all those asset which will be kept by the company more than one year. It is not converted to cash / Sold before one year time. If Company has the intention to sale the asset within one year then it will be classified as current asset.

All the assets are classified as the fixed assets. The depreciation and Depletion are contra asset accounts, these are adjusted against the relevant Assets and Net book value of that assets is reported on the balance sheet.