ACC 100 Study Guide - Final Guide: Financial Statement, Accounts Payable, Current Liability

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lavendermole636

13 Apr 2016

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Liabiliies are divided between current (due in the upcoming 12 months) and long-term liabiliies (due ater 1 year) on the balance sheet. They are shown in order of when they are due. Under current liabiliies accounts payable is always listed first, followed by all the other current liabiliies. If there is no informaion about when the other current liabiliies are due then their order can be random, as long as accounts payable is listed irst. For long term liabiliies the order is again when they are due. For instance, if you have two loans, one due in 2 years and one due in 10 years, the one due in 2 years would always be listed irst. An example of the liabiliies secion of the balance sheet is provided below. On the income statement, if it is a single step, all of the expenses are listed together in order of magnitude (largest to smallest amount).

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Fridley Manufacturing's accounting records reveal the following account balances after adjusting entries are made on December 31, 2018:

Accounts payable		$ 62,500
Bonds payable (9.4%, due in 2025)		800,000
Lease liability*		41,500
Bonds payable (8.7%, due in 2021)		50,000
Deferred tax liability*		133,400
Discount on bonds payable (9.4%, due in 2025)		12,600
Income tax payable		26,900
Interest payable		38,700
Installment note payable (8% equal installments due 2019 to 2022)		120,000
Notes payable (7.8%, due in 2023)		400,000
Premium on notes payable (7.8%, due in 2023)		6,100
Zero coupon note payable, $50,000 face amount, due in 2024 (net of discount)		31,900

* Long-term liability

Required:

Prepare the current liabilities and long-term debt portions of Fridley's statement of financial position at December 31, 2018. Provide a separate line item for each issue (do not combine separate bonds or notes payable), but some items may need to be split into more than one item.

Fridley Manufacturing
Liabilities Section of the Statement of Financial Position
December 31, 2018
Liabilities
Current liabilities:
Accounts payable	$
Interest payable
Income tax payable
Current portion of installment note
Total current liabilities		$
Long-term liabilities:
Bonds payable:
Bonds payable (8.7%, due in 2021)
Bonds payable (9.4%, due in 2025)	$
Less: Discount on bonds payable
Notes payable:
Notes payable (7.8%, due in 2023)	$
Add: Premium on notes payable
Installment note payable (8%)
Note payable (4%, due in 2024)	$
Less: Discount on note payable
Other long-term liabilities:
Lease liability
Deferred tax liability
Total liabilities		$

amethystgerbil16

Current Liabilities

The following are accounts commonly used in accountinginformation systems:

1. Accounts payable

2.Saaries payable

3.Common stock

4.Current portion of long-term debt

5.Unearned revenue

6.Notes payable (due in 60 days)

7.Taxes payable

8.Allowance for doubtful accounts

9.Notes payable (due in 2 years)

Required: Identify whether each item would be classified on abalance sheet as a current liabiity, a long-term liability, orsomething else.

viridianwombat457

Balance Sheet Preparation

The following is a December 31, 2015, post-closing trial balancefor the Happy Valley Corporation.

Account Title	Debits	Credits
Cash	25100
Accounts Receivable	53600
Inventories	82000
Interest Payable		8420
Marketable Securities	41600
Land	105000
Buildings	304000
Accumulated Depreciation -- Building		100000
Equipment	76000
Accumulated Depreciation -- Equipment		25600
Copyright (net of Amortization)	9760
Prepaid Expenses	32700
Accounts Payable		60200
Unearned Revenues		17300
Notes Payable		256000
Allowance for Uncollectible Accounts		4950
Common Stock		?
Retained Earnings		69900

Additional Information:

1. The $105000 balance in the landaccount consists of $87600 for the cost of land where the plant andoffice buildings are located. The remaining amount represents thecost of land being held for speculation.

2. The $41600 in the marketablesecurities account represents an investment in the common stock ofanother corporation. Valley intends to sell one-half of the stockwithin the next year.

3. The notes payable account consistsof a note due in six months and a $187000 note due in three equalannual installments, with the first payment due in August of2015.

Required: Calculate the following balance sheet totals for theValley Pump Corporation at December 31, 2014.

Common Stock

Current Assets

Property, Plant and Equipment (net)

Intangible and Other Assets

Total Assets

Short-term Note Payable

Current Liabilities

Long-term Liabilities

Total Equity

Total Liabilities and Equity

Please include a detailed answer for the accounts you includedto find the balance of each.

ACC 100 Study Guide - Final Guide: Financial Statement, Accounts Payable, Current Liability

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