Question
Following are accounts and balances, in random order, from the adjusted trial balance of Deck Corp. at December 31. Debits equal credits, all amounts are
Following are accounts and balances, in random order, from the adjusted trial balance of Deck Corp. at December 31. Debits equal credits, all amounts are correct, all accounts have normal balances, and a perpetual FIFO inventory system is used.
B) Prepare a classified balance sheet.
Work in process inventory | $46,400 | Petty cash | $640 | ||
Interest receivable | 3,520 | Preferred stock, $100 par, authorized 5,000 shares | 96,000 | ||
Common stock, nopar, authorized 100,000 shares, issued 40,000 | 240,000 | Deferred revenue | 1440 | ||
Cash | 48,000 | Finished goods inventory | 68,800 | ||
Trademarks (net) | 2,240 | Note receivable (short term) | 6,400 | ||
Land held for speculation | 43,200 | Bonds payable, 6% (due in 6 years) | 80,000 | ||
Supplies inventory | 960 | Accounts payable (trade) | 27,200 | ||
Goodwill | 28,800 | Allowance for doubtful accounts | 2,240 | ||
Raw materials inventory | 20,800 | Notes payable (short term) | 11,520 | ||
Bond sinking fund | 16,000 | Office equipment | 40,000 | ||
Accrued property taxes | 2,240 | Land (used as building site) | 12,800 | ||
Accounts receivable (trade) | 46,400 | Shortterm investments (at market) | 24,800 | ||
Salaries payable | 3,360 | Retained earnings, December 31, prior year | 37,120 | ||
Mortgage payable (due in three years) | 16,000 | Dividends (declared and paid in cash on common stock) | 32,000 | ||
Building | 208,000 | Revenues | 800,000 | ||
Prepaid expense | 3,040 | Cost of goods sold | 480,000 | ||
Equipment held for sale | 12,480 | Expenses (including income taxes) | 160,000 | ||
Deposits (cash collected from customers on sales orders | Income taxes payable | 64,000 | |||
to be delivered next quarter; no revenue yet recognized) | 1,600 | Interest payable | 1,600 | ||
Longterm investment in bonds of | Accumulated depreciation, office equipment | 2,560 | |||
Kaline Corp. (at cost, to be held to maturity) | 80,000 | Accumulated depreciation, building | 8,000 | ||
Patents, net | 22,400 | ||||
Paid in capital in excess of par Preferred stock | 12,800 |
c. Assume that between December 31 and issuance of the financial statements, a flood damaged the finished goods inventory in an amount estimated to be $32,000. This event has not been (and should not have been) recognized in the current year statements. However, disclosure in the current year's statements is required. Prepare the necessary disclosure.
Note A: On (date), a severe flood damaged the _____ in an amount estimated to be $____.
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