Question

Sheffield Corp. had the following accounts and balances: Accounts payable $28300 Equipment $34800 Accounts receivable 4550 Land 34700 Buildings ? Unearned service revenue 9700 Cash 14750 Total stockholders' equity ? If total stockholder's equity is $95000, what is the balance of the Buildings account?

Answer 1

Answer:

The balance on the building account is $44,200

Explanation:

The total value of the right hand side must equal the left hand side of a balance sheet. This means the total asset must equal liability plus shareholder equity.

Total Asset                           $

Equipment                      34,800  

Accounts receivable        4,550  

Land                                34,700  

Buildings                           ?

Cash                                14,750                      

                                             88,800      

 

Total Liability and Equity            $

Accounts payable                     28,300  

Unearned service revenue        9,700  

Stockholder's equity                95,000    

 Total Liability and Equity     133,000                  

Buildings  =  Total Liability and Equity - Total Asset  

                        =   $133,000 - $88,800 = $44,200

The balance on the building account is $44,200