question 1

The balance sheet items for F .B (Arranged in Alphabetical order) were as follows at August 1, 2014. find Retained Earnings.

Accounts payable $16,200.00

Accounts Receivables $11,260.00

Building $84,000.00

Capital Stock $80,000.00

Cash $6,940.00

Equipment and Fixtures $44,500.00

Land $67,000.00

Notes Payable $74,900.00

Salaries Payable $8,900.00

Supplies $7,000.00

During the next two days, the following transactions occurred:

Aug. 2. Additional capital stock was sold for $25,000. The accounts payable were paid in full. (No payment was made on notes payable or salaries payable)

Aug. 3 Equipment was purchased at a cost of $7,200 to be paid within 10 days. Supplies were purchased for $1,250 cash from a restaurant supply center that was going out of business. These supplies would have cost $1,890 if purchased through normal channels.

Prepare a balance sheet at August 1, 2015

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question 2

Prepare a balance sheet at August 3, 2015, and a Statement of cash Flows for August 1 3. Classify the payment of account payable and the purchase of supplies as operating activities.

Assume the notes payable do not come due for several years, is Franklin Bakery in a stronger financial position on August 1 or on August 3? Explain briefly.

The following list of Balance sheet items are in random order for Alexander Farms, Inc., at September 30, 2015:

Land $490,000.00

Fences and Gates $33,570.00

Barns and Sheds $78,300.00

Irrigation System $20,125.00

Notes Payable $330,000.00

Cash $16,710.00

Accounts Receivables $22,365.00

Lives stock $120,780.00 Citrus Trees $76,650.00

Farm Machinery $42,970.00

Account payable $77,095.00

Retained Earnings ?

Property taxes Payable $9,135.00

Wages payable $5,820.00

Capital Stock $290,000.00

Prepare a balance sheet by using these items and computing the amount for retained earnings.

b. Assume that on September 30, immediately after this balance sheet was prepared, a tornado completely destroyed one of the barns. This barn had a cost of $14,000 and was not insured against this type of disaster. Explain what changes would be required in your September 30 balance sheet to reflect the loss of this barn.

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