Computing Retained Earnings and Preparing a Classified Balance Sheet The following data, in no particular order, are from the accounts of Brown Corp as of December 31, its annual year end All amounts are accurate, all accounts have normal balances and total debits equal total credits, and all amounts are in $millions Description Amount Description Amount Accounts payable (trade) $72 Deferred revenue $18 Debt retirement fund (long term) 36 Cash dividends payable 45 Accounts receivable 153 Inventory 270 Income taxes payable 36 Land held for future business site 162 Short term investments, marketable securities Equipment and furniture 630 (cost approximate fair value) 90 Net income 315 Bonds payable (long term) 459 Cash dividends declared 27 Accumulated depreciation, equipment and furniture 54 Prepaid expenses (short term) 9 Common stock, par $1 (800,000 shares authorized) 630 Patent 36 Cash 180 Prepaid rent (long term) 18 Retained earnings, December 31, prior year 153 Investment in stock of Zinc Inc (long term) 234 Allowance for doubtful accounts 18 Paid in capital in excess of parCommon 45 a Compute the year end balance of retained earnings $ million b Prepare a classified balance sheet as of December 31 Note Do not use negative signs with any of your answers c Compute working capital on December 31 $ million Balance Sheet As of December 31 ( $ millions) Assets Current assets Investments Property, plant, and equipment Intangible assets Other assets Liabilities and Stockholders' Equity Current liabilities Property, plant, and equipment Intangible assets Other assets Liabilities and Stockholders' Equity Current liabilities $ Long term liabilities Stockholders' equity

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Sep 21, 2024

Computing Retained Earnings and Preparing a Classified Balance Sheet The following data, in no particular order, are from the accounts of Brown Corp. as of

Computing Retained Earnings and Preparing a Classified Balance Sheet The following data, in no particular order, are from the accounts of Brown Corp. as of December 31, its annual year-end. All amounts are accurate, all accounts have normal balances and total debits equal total credits, and all amounts are in $millions.

Description	Amount	Description	Amount
Accounts payable (trade)	$72	Deferred revenue	$18
Debt retirement fund (long-term)	36	Cash dividends payable	45
Accounts receivable	153	Inventory	270
Income taxes payable	36	Land held for future business site	162
Short-term investments, marketable securities		Equipment and furniture	630
(cost approximate fair value)	90	Net income	315
Bonds payable (long-term)	459	Cash dividends declared	27
Accumulated depreciation, equipment and furniture	54	Prepaid expenses (short-term)	9
Common stock, par $1 (800,000 shares authorized)	630	Patent	36
Cash	180	Prepaid rent (long-term)	18
Retained earnings, December 31, prior year	153	Investment in stock of Zinc Inc. (long-term)	234
Allowance for doubtful accounts	18	Paid-in capital in excess of parCommon	45

a. Compute the year-end balance of retained earnings.

$ million

b. Prepare a classified balance sheet as of December 31. Note: Do not use negative signs with any of your answers.

c. Compute working capital on December 31.

$ million

Balance Sheet As of December 31 (\$ millions) Assets Current assets Investments Property, plant, and equipment Intangible assets Other assets Liabilities and Stockholders' Equity Current liabilities Property, plant, and equipment Intangible assets Other assets Liabilities and Stockholders' Equity Current liabilities $ Long-term liabilities Stockholders' equity