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P5-4 (Preparation of a Corrected Balance Sheet) BALANCE SHEET DECEMBER 31, 2014 Goodwill (Note 2) 120,000 Buildings (Note 1) 1,640,000 Inventory 312,100 Land 950,000 Accounts

P5-4 (Preparation of a Corrected Balance Sheet) BALANCE SHEET

DECEMBER 31, 2014

Goodwill (Note 2) 120,000

Buildings (Note 1) 1,640,000

Inventory 312,100

Land 950,000

Accounts receivable 950,000

Treasury stock (50,000 shares) 170,000

Cash on hand 87,000

Assets allocated to trustee for plant expansion

Cash in bank 70,000

Debt ivnestments (held-to-maturity) 1380,000

$3,663,000

Equities

Noes payable (note 3) 600,000

Common stock, authorized and issued, 1,000,000 shares, no par 1,150,000

Retained earnings 803,000

Noncontrolling interest 55,000

Appreciation capital (Note 1) 570,000

Income tax payable 75,000

Rserve for depreciation recorded to date on the building 410,000

$3,663,000

Note 1: Buildings are stated at cost, except for one building that was recorded at appraised value. The excess of appraisal value over cost was $570,000. Depreciation has been recorded based on cost.

Note 2: Goodwill in the amount of $120,000 was recognized because the company believed that book value was not an accurate representation of the fair value of the company. The gain of $120,000 was credited to Retained Earnings.

Note 3: Notes payable are long-term except for the current installment due of $100,000 Note 4: Restricted cash and debt investments consist of capital allocated to a trustee for plant expansion.

Instructions

Prepare a corrected classified balance sheet in good form. The notes above are for information only. **I have spent over 5 hours on this and cannot get the stupid thing to balance. If you could explain why it doesn't balance when I add (or leave out) the Appraisal value of $570,000, and depreciation, and goodwill. Thank you very much for your time.

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