ACCOUNTING
The following balance sheet was prepared by the bookkeeper for Blue Company as of December 31, 2011
Blue Company
Balance Sheet
as of December 31, 2011
Cash $90,000
Accounts receivable (net) 42,000
Inventories 57,000
Equipment (net) 96,000
Patents 32,000
Sub-Total 393,500
Accounts payable 75,000
Long-term liabilities 100,000
Stockholders' equity 218,500
Sub-Total 393,500
The following additional information is provided:
1) Cash includes the cash surrender value of a life insurance policy $5,000 and a bank overdraft of $4,000 has been deducted.
2) The net accounts receivable balance includes:
a) Accounts receivable debit balances $50,000
b) Accounts receivable credit balances 0
c) Allowance for doubtful accounts 3,800
3) Inventories do not include goods costing $3,000 shipped out on consignment. Receivables of $3,000 were recorded on these goods.
4) Investments include investments in common stock, trading $13,000 and available-for-sale $46,300 and franchises $17,000
INSTRUCTIONS
Prepare a balance sheet in good form (Stockholders' equity details can be omitted)
Do not worry about balancing the statement but rather compute the account balances properly for presentation purposes.
Click here for the SOLUTION
