Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Sandhill Co. was formed on January 1, 2022. At December 31, 2022, Miko Liu, the president and sole stockholder, decided to prepare a balance sheet,

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
Sandhill Co. was formed on January 1, 2022. At December 31, 2022, Miko Liu, the president and sole stockholder, decided to prepare a balance sheet, which appeared as follows. Assets Sandhill Co. Balance Sheet December 31, 2022 Liabilities and Stockholders' Equity $21,500 Accounts payable $30,000 57,000 Notes payable 14,400 35,000 Boat loan 23,100 23,000 Stockholders' equity 69,000 Cash Accounts receivable Inventory Boat Miko willingly admits that she is not an accountant by training. She is concerned that her balance sheet might not be correct. She has provided you with the following additional information 1. The boat actually belongs to Miko, not to Sandhill Co. However, because she thinks she might take customers out on the boat occasionally, she decided to list it as an asset of the company. To be consistent, she also listed as a liability of the corporation her personal loan that she took out at the bank to buy the boat. The Inn Accounts receivable Inventory Boat 57,000 35,000 23,000 Notes payable Boat loan Stockholders' equity 14,400 23,100 69,000 1. Miko willingly admits that she is not an accountant by training. She is concerned that her balance sheet might not be correct. She has provided you with the following additional information. The boat actually belongs to Miko, not to Sandhill Co. However, because she thinks she might take customers out on the boat occasionally, she decided to list it as an asset of the company. To be consistent she also listed as a liability of the corporation her personal loan that she took out at the bank to buy the boat. The inventory was originally purchased for $24,600, but due to a surge in demand Miko now thinks she could sell it for $35,000. She thought it would be best to record it at $35,000. Included in the accounts receivable balance is $10,800 that Miko loaned to her brother 5 years ago. Miko included this in the receivables of Sandhill Co. so she wouldn't forget that her brother owes her money. 2. 3 (b) Provide a corrected balance sheet for Sandhill Co. (Hint: To get the balance sheet to balance, adjust stockholders equity) (List assets in order of liquidity.) - 725 !!! (6) Provide a corrected balance sheet for Sandhill Co.. (Hint: To get the balance sheet to balance, adjust stockholders' equity.) (List assets in order of liquidity.) SANDHILL CO. Balance Sheet Assets $ Liabilities and Stockholders' Equity Assets $ Liabilities and Stockholders' Equity 2

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Accounting questions