E5-3.

(Classification of Balance Sheet Accounts)

(LO 2, 3) Assume that Fielder Enterprises uses the following headings on its balance sheet.

• (a)Current assets.
• (b)Investments.
• (c)Property, plant, and equipment.
• (d)Intangible assets.
• (e)Other assets.
• (f)Current liabilities.
• (g)Long-term liabilities.
• (h)Capital stock.
• (i)Equity attributed to noncontrolling interest.
• (j)Paid-in capital in excess of par.
• (k)Retained earnings.

Instructions

Indicate by letter how each of the following usually should be classified. If an item should appear in a note to the financial statements, use the letter N to indicate this fact. If an item need not be reported at all on the balance sheet, use the letter X.

• 1.Prepaid insurance.
• 2.Stock owned in affiliated companies.
• 3.Unearned service revenue.
• 4.Advances to suppliers.
• 5.Unearned rent revenue.
• 6.Preferred stock.
• 7.Additional paid-in capital on preferred stock.
• 8.Copyrights.
• 9.Petty cash fund.
• 10.Sales taxes payable.
• 11.Accrued interest on notes receivable.
• 12.Twenty-year issue of bonds payable that will mature within the next year. (No sinking fund exists, and refunding is not planned.)
• 13.Machinery retired from use and held for sale.
• 14.Fully depreciated machine still in use.
• 15.Accrued interest on bonds payable.
• 16.Salaries that company budget shows will be paid to employees within the next year.
• 17.Discount on bonds payable. (Assume related to bonds payable in item 12.)
• 18.Accumulated depreciationbuildings.
• 19.Shares held by noncontrolling stockholders.