Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The following balance sheet for the Los Gatos Corporation was prepared by a recently hired accountant. In reviewing the statement you notice several errors LOS

image text in transcribed
image text in transcribed
image text in transcribed
The following balance sheet for the Los Gatos Corporation was prepared by a recently hired accountant. In reviewing the statement you notice several errors LOS GATOS CORPORATION Balance Sheet At December 31, 2021 Assets Cash Accounts receivable Inventory Machinery (net Franchise (net) Total assets Liabilities and Shareholders' Equity Accounts payable Allowance for uncollectible accounts Notes payable Bonds payable Shareholders equity Total liabilities and shareholders' equity 70,000 125,000 70,000 135,000 45,000 $ 445,000 $ 80,000 20,000 85,000 125,000 135,000 $ 445,000 Additional Information 1. Cash includes a $35,000 restricted amount to be used for repayment of the bonds payable in 2025. 2 The cost of the machinery is $220,000. 3. Accounts receivable includes a $35,000 notes receivable from a customer due in 2024. 4. The notes payable balance includes accrued interest of $20,000. Principal and interest are both due on February 1, 2022 5 The company began operations in 2016. Net Income less dividends since inception of the company totals $50,000 6,65,000 shares of no par common stock were issued in 2016. 100,000 shares are authorized Required: Prepare a corrected, classified balance sheet. Use the additional information to help determine appropriate classifications and account balances. The cost of machinery and its accumulated depreciation are shown separately. (Amounts to be deducted should be indicated by a minus sign.) LOS GATOS CORPORATION Balance Sheet At December 31, 2021 Assets Current assets LOS GATOS CORPORATION Balance Sheet At December 31, 2021 Assets Current assets Net accounts receivable 0 Total current assets Investments 0 Total investments Property, plant, and equipment: 0 Net property, plant, and equipment Intangible assets Total assets $ 0 Liabilities and Shareholders' Equity Current liabilities Total current liabilities 0 Long-term liabilities Saved ses 0 Total investments Property, plant, and equipment 0 Net property, plant, and equipment Intangible assets $ Total assets Liabilities and Shareholders' Equity Current liabilities. 0 Total current liabilities Long-term liabilities 0 Total liabilities Shareholders equity 0 Total shareholders' equity Total liabilities and shareholders' equity $ 0

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_2

Step: 3

blur-text-image_3

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

Accounting For Financial Instruments

Authors: Cormac Butler

1st Edition

0470699809, 978-0470699805

More Books

Students also viewed these Accounting questions

Question

=+ explain how success might be measured and assessed

Answered: 1 week ago

Question

Differentiate between gender equality and gender equity.

Answered: 1 week ago