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Problem 3-8 (Algo) Balance sheet; errors; missing amounts [LO3-2, 3-3] The following incomplete balance sheet for the Sanderson Manufacturing Company was prepared by the companys
Problem 3-8 (Algo) Balance sheet; errors; missing amounts [LO3-2, 3-3]
The following incomplete balance sheet for the Sanderson Manufacturing Company was prepared by the companys controller. As accounting manager for Sanderson, you are attempting to reconstruct and revise the balance sheet.
Current Assets | |
Cash | $2,150 |
A/R | 5,300 |
Allowance for Uncollectile accounts | (1,300) |
Finished goods inventory | 6,900 |
Prepaid expenses | 2,100 |
total current assets | 15,150 |
Long--term assets: | |
Investments | 3,900 |
Raw materials and work-in-process inv | 3,150 |
Equipment | 18,000 |
Accum. Depreciation | (5,100) |
Patent (net) | ? |
Total Assets | ? |
Liabilities and shareholds equity | |
current liabilities | |
A/p | 6,100 |
N/P | 5,800 |
interest payable (on notes) | 1,000 |
Deferred revenue | 4,800 |
total current liailities | 17,700 |
Long-term lia. | |
Bonds payable | 6,400 |
Interest payable (on bonds) | 400 |
Shareholders equity | |
Common stock | ? |
Retained earnings | ? |
Total Lia. and SH. EQ. |
Additional information ($ in 000s):
- Certain records that included the account balances for the patent and shareholders equity items were lost. However, the controller told you that a complete, preliminary balance sheet prepared before the records were lost showed a debt to equity ratio of 1.4. That is, total liabilities are 140% of total shareholders equity. Retained earnings at the beginning of the year was $5,800. Net income for 2021 was $2,000 and $400 in cash dividends were declared and paid to shareholders.
- Management intends to sell the investments in the next six months.
- Interest on both the notes and the bonds is payable annually.
- The notes payable are due in annual installments of $1,450 each.
- Deferred revenue will be recognized as revenue equally over the next two fiscal years.
- The common stock represents 400,000 shares of no par stock authorized, 340,000 shares issued and outstanding.
- What to prepare a compete and corrected, classified balance sheet.
PLEASE EXPLAIN HOW YOU FIND THE NUMBERS FOR PARTS WITH "?" .
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