Question

Instructions: Please prepare a Balance Sheet on your scratch paper based on the following Adjusted Trial Balance and Additional Information below to answer this question and the next three (3) questions.
(Hint: you may also want to prepare a new Income Statement and Statement of Stockholders' Equity before preparing the Balance Sheet to make sure you have the necessary information for the Balance Sheet account balances.)
You will need to know the amounts for total current assets, total long-term assets, total current liabilities, total long-term liabilities, and total stockholders' equity.
Adjusted Trial
Balance As of 12/31/20xx
Accounts Debit Credit
Cash $25,486
Prepaid Rent 5,700
Supplies 4,400
Building 100,000
Accumulated Depreciation $6,000
Accounts Payable 1800
Deferred Revenue 1,300
Notes Payable (due in 24 months 80,486
Common Stock 2,100
Retained Earnings 46,400
Dividends 4,000
Service Revenue 12,400
Rent Expense 900
Supplies Expense 3,000
Utility Expense 1,000
Depreciation Expense 6,000
Totals $150,486 $150,486
Additional Information:
Beginning Balance of Common Stock on 1/1/20xx $2.100
Beginning Balance of Retained Earnings on 1/1/20xx $46,400
No new stock was issued during the accounting period. .
Hint: Please remember the formula for retained earnings when preparing this statement
Question: What is the amount shown for Total Current Assets shown on the Classified Balance Sheet you prepared on your scratch paper?

Answer 1

Answer:

a) Balance Sheet as of December 31, 20xx:

Assets:

Cash                                               $25,486

Prepaid Rent                                      5,700

Supplies                                             4,400

Total current assets                     $35,586

Building                       100,000

Acc. Depreciation         (6,000)   $94,000

Total assets                                $129,586

Current Liabilities:

Accounts Payable                            $1,800

Deferred Revenue                             1,300

Total current liabilities                     $3,100

Notes Payable (due in

24 months                                      80,486

Total liabilities                               $83,586

Common Stock               2,100

Retained Earnings       43,900       46,000

Total liabilities and equity           $129,586

b) Total current assets = $35,586

Explanation:

a) Data and Calculations:

Adjusted Trial

Balance as of 12/31/20xx

Accounts                      Debit            Credit

Cash                            $25,486

Prepaid Rent                   5,700

Supplies                          4,400

Building                       100,000

Accumulated Depreciation            $6,000

Accounts Payable                              1,800

Deferred Revenue                             1,300

Notes Payable (due in 24 months 80,486

Common Stock                                  2,100

Retained Earnings                          46,400

Dividends                      4,000

Service Revenue                             12,400

Rent Expense                  900

Supplies Expense        3,000

Utility Expense              1,000

Depreciation Expense 6,000

Totals                      $150,486    $150,486

Additional data:

Beginning Balance of Common Stock on 1/1/20xx        $2,100

Beginning Balance of Retained Earnings on 1/1/20xx $46,400

Income Statement for the year ended December 31, 20xx

Service Revenue                       $12,400

Rent Expense                  900

Supplies Expense        3,000

Utility Expense              1,000

Depreciation Expense 6,000     10,900

Net Income                                    1,500

Statement of Stockholders' Equity:

Beginning Common Stock on 1/1/20xx         $2,100

Beginning Retained Earnings on 1/1/20xx   46,400

Net Income                                                       1,500

Dividends                                                        (4,000)

Ending Equity balance on 12/31/20xx       $46,000

Retained Earnings on 12/31/20xx:

Beginning Retained Earnings on 1/1/20xx   46,400

Net Income                                                       1,500

Dividends                                                        (4,000)

Retained Earnings on 12/31/20xx              $43,900