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Spreadsheet

Comprehensive: Balance Sheet, Schedules, and Notes

The following is an alphabetical listing of Stone Boat Company's balance sheet accounts and account balances on December 31, 2019:

Accounts Payable	$44,200		Income Taxes Payable	$19,700
Accounts Receivable	37,100		Inventory	85,300
Accumulated Depreciation	109,300		Investment in Affiliate	30,000
Additional Paid-in Capital on Common Stock	20,000		Long-Term Liabilities (book value)	91,000
Additional Paid-in Capital on Preferred Stock	3,200		Miscellaneous Current Payables	6,800
Allowance for Doubtful Accounts	1,600		Notes Receivable	17,000
Bond Sinking Fund	12,500		Preferred Stock	32,000
Cash	13,800		Property, Plant, and Equipment	296,700
Common Stock	80,000		Retained Earnings	84,600

Additional information:

1. The company reports on the balance sheet the net book value of property and equipment and long-term liabilities (known as control accounts). The related details are disclosed in the notes.
2. The straight-line method is used to depreciate property and equipment based upon cost, estimated residual value, and estimated life. The costs of the assets in this account are: land, $29,500; buildings, $164,600; store fixtures, $72,600; and office equipment, $30,000.
3. The accumulated depreciation breakdown is as follows: buildings, $54,600; store fixtures, $37,400; and office equipment, $17,300.
4. The long-term debt includes 12%, $36,000 face value bonds that mature on December 31, 2024, and have an unamortized bond discount of $1,000; 11%, $48,000 face value bonds that mature on December 31, 2025, have a premium on bonds payable of $1,800, and whose retirement is being funded by a bond sinking fund; and a 13% note payable that has a face value of $6,200 and matures on January 1, 2022.
5. The non-interest-bearing note receivable matures on June 1, 2023.
6. Inventory is listed at lower of cost or market; cost is determined on the basis of average cost.
7. The investment in affiliate is carried at cost. The company has guaranteed the interest on 12%, $50,000, 15-year bonds issued by this affiliate, Jay Company.
8. Common stock has a $10 par value per share, 10,000 shares are authorized, and 1,000 shares were issued during 2019 at a price of $13 per share, resulting in 8,000 shares issued at year-end.
9. Preferred stock has a $50 par value per share, 2,000 shares are authorized, and 140 shares were issued during 2019 at a price of $55 per share, resulting in 640 shares issued at year-end.
10. On January 15, 2020, before the December 31, 2019, balance sheet was issued, a building with a cost of $20,000 and a book value of $7,000 was totally destroyed. Insurance proceeds will amount to only $5,000.
11. Net income and dividends declared and paid during the year were $50,500 and $21,000, respectively.

Required:

1. Prepare Stone Boat's December 31, 2019, balance sheet.

Stone Boat Company Balance Sheet December 31, 2019
Assets
Current Assets:
Cash		$ fill in the blank a662a6097fdefd4_2
Accounts payable		fill in the blank a662a6097fdefd4_4
	$ fill in the blank a662a6097fdefd4_6
	fill in the blank a662a6097fdefd4_8	fill in the blank a662a6097fdefd4_9
Inventory		fill in the blank a662a6097fdefd4_11
Total current assets			fill in the blank a662a6097fdefd4_12
Long-Term Investments:
Notes receivable		$ fill in the blank a662a6097fdefd4_14
Retained earnings		fill in the blank a662a6097fdefd4_16
Total long-term investments			fill in the blank a662a6097fdefd4_17
Additional paid-in capital on common stock		$ fill in the blank a662a6097fdefd4_19
Less: Discount on bonds payable		fill in the blank a662a6097fdefd4_21
Total property, plant, and equipment			fill in the blank a662a6097fdefd4_22
Total Assets			$ fill in the blank a662a6097fdefd4_23
Liabilities
Current Liabilities:
Accounts payable		$ fill in the blank a662a6097fdefd4_25
Income taxes payable		fill in the blank a662a6097fdefd4_27
Long-term liabilities		fill in the blank a662a6097fdefd4_29
Total current liabilities			$ fill in the blank a662a6097fdefd4_30
Long-term liabilities			fill in the blank a662a6097fdefd4_31
Total Liabilities			$ fill in the blank a662a6097fdefd4_32
Shareholders' Equity
Contributed Capital:
Accounts payable		$ fill in the blank a662a6097fdefd4_34
		fill in the blank a662a6097fdefd4_36
		fill in the blank a662a6097fdefd4_38
		fill in the blank a662a6097fdefd4_40
Total contributed capital			$ fill in the blank a662a6097fdefd4_41
Retained earnings			fill in the blank a662a6097fdefd4_42
Total shareholders' equity			$fill in the blank a662a6097fdefd4_43
Total liabilities and shareholders' equity			$ fill in the blank a662a6097fdefd4_44

2. Prepare a statement of shareholders' equity for 2019. (Hint: Work back from the ending account balances.)

STONE BOAT COMPANY
Statement of Shareholders' Equity
For Year Ended December 31, 2019
	Preferred Stock $50 par	Common Stock $10 par	Additional Paid-in Capital on Preferred Stock	Additional Paid-in Capital on Common Stock	Retained Earnings	Total
Balances, 1/1/19	$fill in the blank f28704f6d01ffed_1	$fill in the blank f28704f6d01ffed_2	$fill in the blank f28704f6d01ffed_3	$fill in the blank f28704f6d01ffed_4	$fill in the blank f28704f6d01ffed_5	$fill in the blank f28704f6d01ffed_6
		fill in the blank f28704f6d01ffed_8		fill in the blank f28704f6d01ffed_9		fill in the blank f28704f6d01ffed_10
	fill in the blank f28704f6d01ffed_12		fill in the blank f28704f6d01ffed_13			fill in the blank f28704f6d01ffed_14
					fill in the blank f28704f6d01ffed_16	fill in the blank f28704f6d01ffed_17
					fill in the blank f28704f6d01ffed_19	fill in the blank f28704f6d01ffed_20
Balances, 12/31/19	$fill in the blank f28704f6d01ffed_21	$fill in the blank f28704f6d01ffed_22	$fill in the blank f28704f6d01ffed_23	$fill in the blank f28704f6d01ffed_24	$fill in the blank f28704f6d01ffed_25	$fill in the blank f28704f6d01ffed_26

3. Next Level Compute the debt-to-assets ratio at the end of 2019. Round your answer to one decimal place.

fill in the blank 41cecaf38063fb2_1 %

What is your evaluation of this ratio if it was 39% at the end of 2018?

The debt ratio for 2019 has by over compared to 2018. This indicates that there may be slightly risk for investors and creditors because of interest payments that may have to be made by the company. On the other hand, may benefit if the company