Survey of Accounting Packet 20 As a condition of the borrowings described above, CIC will be required to provide financial statements, including a classified balance sheet, to the lender. W.T. would like to see a pro forma balance sheet if a borrowing is undertaken. The account balances for December 31, 2018 for CIC are presented below. Only one additional adjustment is required. On January 31.2018, CIC sold a parcel of land and received in return cash and a note receivable of $10,000, due January 31, 2019. The note carries interest at the rate of 8%. but interest has not been recorded for the current year. Record this adjustment by updating the accounting equation presented below. Assume that CIC opts to borrow $800,000 under Option #2 presented above. Assume the borrowing takes place on January 1, 2019 as planned and no further transactions occur on that day. Add that transaction to the accounting equation below and then prepare classified balance sheet for CIC for January 1, 2019, Cash Inven Truck Accum Der Pay 76,000 12,000 6,500 10.000 50.000 Adi Int Item Accts Rec Accts Note Rec tory Ret Earn Com Stock 75,000 Bal 8.250 3.750 67.500 Bal 12/31 Borrow Bal 1/1 Cowboy Ice Cream, Inc. Balance Sheet January 1, 2019 LIABILITIES ASSETS Current Assets: Current Liabilities: Total Current Liabilities Long-term Liabilities Total Long-term Liabilities Total Current Assets Total Liabilities Long-term Assets STOCKHOLDERS' EQUITY: Total Long-term Assets Total Stockholders' Equity Total Assets Total Liabilities Stockholders' Equity Survey of Accounting Packet 20 As a condition of the borrowings described above, CIC will be required to provide financial statements, including a classified balance sheet, to the lender. W.T. would like to see a pro forma balance sheet if a borrowing is undertaken. The account balances for December 31, 2018 for CIC are presented below. Only one additional adjustment is required. On January 31.2018, CIC sold a parcel of land and received in return cash and a note receivable of $10,000, due January 31, 2019. The note carries interest at the rate of 8%. but interest has not been recorded for the current year. Record this adjustment by updating the accounting equation presented below. Assume that CIC opts to borrow $800,000 under Option #2 presented above. Assume the borrowing takes place on January 1, 2019 as planned and no further transactions occur on that day. Add that transaction to the accounting equation below and then prepare classified balance sheet for CIC for January 1, 2019, Cash Inven Truck Accum Der Pay 76,000 12,000 6,500 10.000 50.000 Adi Int Item Accts Rec Accts Note Rec tory Ret Earn Com Stock 75,000 Bal 8.250 3.750 67.500 Bal 12/31 Borrow Bal 1/1 Cowboy Ice Cream, Inc. Balance Sheet January 1, 2019 LIABILITIES ASSETS Current Assets: Current Liabilities: Total Current Liabilities Long-term Liabilities Total Long-term Liabilities Total Current Assets Total Liabilities Long-term Assets STOCKHOLDERS' EQUITY: Total Long-term Assets Total Stockholders' Equity Total Assets Total Liabilities Stockholders' Equity
