Question

Presented below are a number of balance sheet items for Montoya, Inc. for the current year, 2020.

Answer 1

Answer:

MONTOYA, INC.  

                                     Balance Sheet  

                               December 31, 2017  

Assets

Current assets  

Cash                                                     $360,000  

Equity Investments (Trading)              121,000  

Notes Receivable                                        445,700  

Income Taxes Receivable                         97,630  

Inventory                                                239,800  

Prepaid Expenses                                         87,920  

Total current assets                                                           $1,352,050  

 

Property, plant, and equipment  

Land                                                             480,000  

Buildings                              $1,640,000  

Less: Accum Deprec - Buildings 270,200          1,369,800  

Equipment                                    1,470,000  

Less: Accum Deprec - Equipment292,000                  1,178,000  

                                                                                              3,027,800

Intangible assets  

Goodwill                                                         125,000  

Total assets                                                                          $4,504,850  

 

Liabilities and Shareholders’ Equity

Current liabilities  

Accounts Payable                                      $490,000  

Notes Payable to Banks                    265,000  

Payroll Taxes Payable                                  177,591  

Income Tax Payable                                 98,362  

Rent Payable - Short-term                         45,000  

Total current liabilities                                                          $1,075,953  

Long-term liabilities  

Unsecured Notes Payable (Long-term)  1,600,000  

Bonds Payable                             $300,000  

Less: Discount on Bonds Payable 15,000    285,000  

Rental Payable Long-term                            480,000  2,365,000

Total liabilities                                                                    3,440,953

 

Shareholders’ equity

Capital Stock  

Preferred stock, $10 par; 20,000 shares authorized, 15,000 shares issued 150,000  

Common stock, $1 par; 400,000 shares authorized, 200,000 issued   200,000 350,000  

Retained Earnings ($1,063,897 - $350,000) 713,897  

Total shareholders’ equity ($4,504,850 – $3,440,953) 1,063,897  

Total liabilities and shareholders’ equity $4,504,850    

Computation of Retained earnings:  

Accounting Equation  

Total assets $4,504,850  

Less: Liabilities 3,440,953  

Less: Contributed capital 350,000  

Retained earnings $713,897