Presented below is the balance sheet of Sargent Corporation for the current year, 2012. The following information
Question:
Presented below is the balance sheet of Sargent Corporation for the current year, 2012.
The following information is presented.1. The current assets section includes: cash $150,000, accounts receivable $170,000 less $10,000 for allowance for doubtful accounts, inventories $180,000, and unearned revenue $5,000. Inventories are stated on the lower-of-FIFO-cost-or-market.2. The investments section includes: the cash surrender value of a life insurance contract $40,000; investments in common stock, short-term (trading) $80,000 and long-term (available-for-sale) $270,000; and bond sinking fund $250,000. The cost and fair value of investments in common stock are the same.3. Property, plant, and equipment includes: buildings $1,040,000 less accumulated depreciation$360,000; equipment $450,000 less accumulated depreciation $180,000; land $500,000; and land held for future use $270,000.4. Intangible assets include: a franchise $165,000; goodwill $100,000; and discount on bonds payable $40,000.5. Current liabilities include: accounts payable $140,000; notes payable??short-term $80,000 and long-term $120,000; and taxes payable $40,000.6. Long-term liabilities are composed solely of 7% bonds payable due 2020.7. Stockholders?? equity has: preferred stock, no par value, authorized 200,000 shares, issued 70,000 shares for $450,000; and common stock, $1.00 par value, authorized 400,000 shares, issued 100,000 shares at an average price of $10. In addition, the corporation has retained earnings of $320,000.InstructionsPrepare a balance sheet in good form, adjusting the amounts in each balance sheet classification as affected by the information givenabove.
GoodwillGoodwill is an important concept and terminology in accounting which means good reputation. The word goodwill is used at various places in accounting but it is recognized only at the time of a business combination. There are generally two types of... Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Accounts Payable
Accounts payable (AP) are bills to be paid as part of the normal course of business.This is a standard accounting term, one of the most common liabilities, which normally appears in the balance sheet listing of liabilities. Businesses receive... Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that...
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SARGENT CORPORATION Balance Sheet December 31 2012 Assets Current assets Cash 150000 Trading securit...View the full answer
