Intermediate Accounting. Chapter 3/4.

A B E Balance Sheet Preparation Festiva Holiday Decorations' accountants are attempting to prepare the company's classified balance sheet for the year ended December 31, 20XX. The accountants have already compiled all of the account balances into a trial balance to assist with the preperation of this document and want you to use the document to prepare the firm's classified balance sheet. Because these accountants are super cool they have already prepared the company's income statement and statement of retained earnings and handed you a modified trial balance that contains just the amounts that need to be listed on the balance sheet. Festiva Holiday Decorations' balance sheet accounts were 2 as such at the end of the period: 3 Account Debit Credit 4 Cash $ 800,000 5 Accounts Receivable 400,000 6 Allowance for Bad Debt $ 9,000 7 Supplies 20,000 8 Notes Receivable, Short-term 50,000 9 Raw Materials Inventory 75,000 10 Work in Process Inventory 85,000 11 Finished Goods Inventory 140,000 12 Common Stock Investments 350,000 13 HTM Debt Investments 250,000 14 Buildings 1,000,000 15 Accumulated Depreciation Buildings 180,000 16 Equipment 750,000 17 Accumulated Depreciation-Equipment 170,000 18 Land 650,000 19 Patents 65,000 20 Copyrights 45,000 21 Goodwill 179,000 22 Accounts Payable 290,000 23 Salaries and Wages Payable 15,000 24 Interest Payable 15,000 25. Italitila Info Classified BS 5.000 D6 fy S A 5 Accounts Receivable 6 Allowance for Bad Debt 7 Supplies 8 Notes Receivable, Short-term 9 Raw Materials Inventory 10 Work-in-Process Inventory 11 Finished Goods Inventory 12 Common Stock Investments 13 HTM Debt Investments 14 Buildings 15 Accumulated Depreciation-Buildings 16 Equipment 17 Accumulated Depreciation Equipment 18 Land 19 Patents 20 Copyrights 21 Goodwill 22 Accounts Payable 23 Salaries and Wages Payable 24 Interest Payable 25 Utilities Payable 26 Notes Payable, Long-term 27 Bonds Payable 28 Premium on Bonds Payable 29 Mortgages Payable 30 Common Stock 31 PIC Common 32 Retained Earnings 33 Treasury Stock 34 Equity Attributable to Noncontrolling Interest 35 Total Info Classified BS B C 400,000 9,000 20,000 50,000 75,000 85,000 140,000 350,000 250,000 1,000,000 180,000 750,000 170,000 650,000 65,000 45,000 179,000 290,000 15,000 15,000 5,000 700,000 600,000 150,000 600,000 300,000 700,000 1,050,000 130,000 205,000 $ 4,989,000 S 4,989,000 D6 fr B D 32 Retained Earnings 1,050,000 33 Treasury Stock 130,000 34 Equity Attributable to Noncontrolling Interest 205,000 35 Total $ 4,989,000 $ 4,989,000 Festiva's accounting staff also wants to disclose the information below to users of the firm's financial statements in the notes to the balance sheet. They have also included guidelines about their preferred formatting for the balance 36 sheet. a) Festiva is restricting $150,000 worth of cash for the renovation of their primary production facility. The company's accountants want you to disclose this restricted cash as a separate line item on the balance sheet. This 37 renovation is not expected to begin during the upcoming fiscal year. b) The company estimates bad debt using the percent-of-receivables method and assumes that 2.25% of all 38 receivables will ultimately be uncollectible. c) Festiva Holiday Decorations wants to disclose the total value of inventory as a single line item on the balance sheet and then disclose the portions of this inventory balance which can be attributed to raw materials, WIP, and 39 finished goods within the financial statement's notes. d) Festiva has a common stock investments in 50,000 shares of Addams Incorporated's $1 par common stock. Festiva has no plans to sell this investment within the upcoming fiscal year. The current market price of these 40 shares is $20 per share. e) The company's held-to-maturity debt investment is in five-year bonds issued by Vorhees Tech which pay 3.75% 41 interest annually. These bonds will not mature in the next year. f) Festiva depreciates all long-term plant assets using the straight-line method of depreciation. These assets have 42 varying useful lives. e) Festiva's outstanding bonds are 10-year secured senior notes which pay 4% interest annually. The will not 43 mature for another 7 years. h) At the time of the balance sheet's preparation, Festiva Holiday Decorations' board of directors has authorized the issuance of 500,000 shares of $1.50 par common stock. The company has issued 200,000 of these shares and 44 190,000 of them are currently outstanding. 45 46 Festiva Holiday Decorations Classified Balance Sheet For the Year Ended December 31, 20X Art 5 Current Assets bates 7 es Arvons levable Total Current Liabilities Long Term Debr Bonds Payable Add 10 11 12 12 Total Current Ass on Termes 15 10 17 Totalte femments 10 Property. Planta 20 holen les 2 ment Total tong Term Debt Total abilities Stockholders Equity Capital Stock Additional din Capital Total Pald-in Capital Total Pocity. Plant & Lent 26 Intube Total Futy Attributable to festiva Shareholders Total Equity Attributable to Nocontrolling interest Total Stockholders' Equity CERR Totaltabiles & Stockholders' Equity Notes to the classified Balance Sheet into Causfied as D Festiva Holiday Decorations Classified Balance Sheet For the Year Ended December 31, 2018 Assets Talvis Current Liabilities Current Assets Cash Les Accounts flecrivable Le Total Current tibiities Long Term Debt 1 Bonds Payable Add: Total Long-Term Debt Totaltabilities Total Current Assets Lorem investments 5 6 7 Total Long Term Investments Property. Plant Estiment Building Less Equipment Stockholders' fity Capital Stock Additional Paid-in Capital: Total Paid in Capital M Total Property, plant, Topment Intante Assets 27 20 Total Equity Attributable to ustva Shareholders Total Equity Attributable to Noncontrolling Total Stockholders' Equity 10 Totalitable Assets Tutels Total Liabilites & Stockholders' Equity Notes to the caused Balance Sheet in classifieds A B E Balance Sheet Preparation Festiva Holiday Decorations' accountants are attempting to prepare the company's classified balance sheet for the year ended December 31, 20XX. The accountants have already compiled all of the account balances into a trial balance to assist with the preperation of this document and want you to use the document to prepare the firm's classified balance sheet. Because these accountants are super cool they have already prepared the company's income statement and statement of retained earnings and handed you a modified trial balance that contains just the amounts that need to be listed on the balance sheet. Festiva Holiday Decorations' balance sheet accounts were 2 as such at the end of the period: 3 Account Debit Credit 4 Cash $ 800,000 5 Accounts Receivable 400,000 6 Allowance for Bad Debt $ 9,000 7 Supplies 20,000 8 Notes Receivable, Short-term 50,000 9 Raw Materials Inventory 75,000 10 Work in Process Inventory 85,000 11 Finished Goods Inventory 140,000 12 Common Stock Investments 350,000 13 HTM Debt Investments 250,000 14 Buildings 1,000,000 15 Accumulated Depreciation Buildings 180,000 16 Equipment 750,000 17 Accumulated Depreciation-Equipment 170,000 18 Land 650,000 19 Patents 65,000 20 Copyrights 45,000 21 Goodwill 179,000 22 Accounts Payable 290,000 23 Salaries and Wages Payable 15,000 24 Interest Payable 15,000 25. Italitila Info Classified BS 5.000 D6 fy S A 5 Accounts Receivable 6 Allowance for Bad Debt 7 Supplies 8 Notes Receivable, Short-term 9 Raw Materials Inventory 10 Work-in-Process Inventory 11 Finished Goods Inventory 12 Common Stock Investments 13 HTM Debt Investments 14 Buildings 15 Accumulated Depreciation-Buildings 16 Equipment 17 Accumulated Depreciation Equipment 18 Land 19 Patents 20 Copyrights 21 Goodwill 22 Accounts Payable 23 Salaries and Wages Payable 24 Interest Payable 25 Utilities Payable 26 Notes Payable, Long-term 27 Bonds Payable 28 Premium on Bonds Payable 29 Mortgages Payable 30 Common Stock 31 PIC Common 32 Retained Earnings 33 Treasury Stock 34 Equity Attributable to Noncontrolling Interest 35 Total Info Classified BS B C 400,000 9,000 20,000 50,000 75,000 85,000 140,000 350,000 250,000 1,000,000 180,000 750,000 170,000 650,000 65,000 45,000 179,000 290,000 15,000 15,000 5,000 700,000 600,000 150,000 600,000 300,000 700,000 1,050,000 130,000 205,000 $ 4,989,000 S 4,989,000 D6 fr B D 32 Retained Earnings 1,050,000 33 Treasury Stock 130,000 34 Equity Attributable to Noncontrolling Interest 205,000 35 Total $ 4,989,000 $ 4,989,000 Festiva's accounting staff also wants to disclose the information below to users of the firm's financial statements in the notes to the balance sheet. They have also included guidelines about their preferred formatting for the balance 36 sheet. a) Festiva is restricting $150,000 worth of cash for the renovation of their primary production facility. The company's accountants want you to disclose this restricted cash as a separate line item on the balance sheet. This 37 renovation is not expected to begin during the upcoming fiscal year. b) The company estimates bad debt using the percent-of-receivables method and assumes that 2.25% of all 38 receivables will ultimately be uncollectible. c) Festiva Holiday Decorations wants to disclose the total value of inventory as a single line item on the balance sheet and then disclose the portions of this inventory balance which can be attributed to raw materials, WIP, and 39 finished goods within the financial statement's notes. d) Festiva has a common stock investments in 50,000 shares of Addams Incorporated's $1 par common stock. Festiva has no plans to sell this investment within the upcoming fiscal year. The current market price of these 40 shares is $20 per share. e) The company's held-to-maturity debt investment is in five-year bonds issued by Vorhees Tech which pay 3.75% 41 interest annually. These bonds will not mature in the next year. f) Festiva depreciates all long-term plant assets using the straight-line method of depreciation. These assets have 42 varying useful lives. e) Festiva's outstanding bonds are 10-year secured senior notes which pay 4% interest annually. The will not 43 mature for another 7 years. h) At the time of the balance sheet's preparation, Festiva Holiday Decorations' board of directors has authorized the issuance of 500,000 shares of $1.50 par common stock. The company has issued 200,000 of these shares and 44 190,000 of them are currently outstanding. 45 46 Festiva Holiday Decorations Classified Balance Sheet For the Year Ended December 31, 20X Art 5 Current Assets bates 7 es Arvons levable Total Current Liabilities Long Term Debr Bonds Payable Add 10 11 12 12 Total Current Ass on Termes 15 10 17 Totalte femments 10 Property. Planta 20 holen les 2 ment Total tong Term Debt Total abilities Stockholders Equity Capital Stock Additional din Capital Total Pald-in Capital Total Pocity. Plant & Lent 26 Intube Total Futy Attributable to festiva Shareholders Total Equity Attributable to Nocontrolling interest Total Stockholders' Equity CERR Totaltabiles & Stockholders' Equity Notes to the classified Balance Sheet into Causfied as D Festiva Holiday Decorations Classified Balance Sheet For the Year Ended December 31, 2018 Assets Talvis Current Liabilities Current Assets Cash Les Accounts flecrivable Le Total Current tibiities Long Term Debt 1 Bonds Payable Add: Total Long-Term Debt Totaltabilities Total Current Assets Lorem investments 5 6 7 Total Long Term Investments Property. Plant Estiment Building Less Equipment Stockholders' fity Capital Stock Additional Paid-in Capital: Total Paid in Capital M Total Property, plant, Topment Intante Assets 27 20 Total Equity Attributable to ustva Shareholders Total Equity Attributable to Noncontrolling Total Stockholders' Equity 10 Totalitable Assets Tutels Total Liabilites & Stockholders' Equity Notes to the caused Balance Sheet in classifieds