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Problem 3-3 Balance sheet preparation [LO3-2, 3-3]

The following is a December 31, 2018, post-closing trial balance for Almway Corporation.

Account Title		Debits			Credits
Cash	$	45,000
Investments		110,000
Accounts receivable		60,000
Inventories		200,000
Prepaid insurance (for the next 9 months)		9,000
Land		90,000
Buildings		420,000
Accumulated depreciationbuildings				$	100,000
Equipment		110,000
Accumulated depreciationequipment					60,000
Patents (net of amortization)		10,000
Accounts payable					75,000
Notes payable					130,000
Interest payable					20,000
Bonds Payable					240,000
Common stock					300,000
Retained earnings					129,000
Totals	$	1,054,000		$	1,054,000

Additional information:

1. The investment account includes an investment in common stock of another corporation of $30,000 which management intends to hold for at least three years. The balance of these investments is intended to be sold in the coming year.
2. The land account includes land which cost $25,000 that the company has not used and is currently listed for sale.
3. The cash account includes $15,000 restricted in a fund to pay bonds payable that mature in 2021 and $23,000 restricted in a three-month Treasury bill.
4. The notes payable account consists of the following:

1. a $30,000 note due in six months.
2. a $50,000 note due in six years.
3. a $50,000 note due in five annual installments of $10,000 each, with the next installment due February 15, 2019.

5. The $60,000 balance in accounts receivable is net of an allowance for uncollectible accounts of $8,000.
6. The common stock account represents 100,000 shares of no par value common stock issued and outstanding. The corporation has 500,000 shares authorized.

Required: Prepare a classified balance sheet for the Almway Corporation at December 31, 2018. (Amounts to be deducted should be indicated by a minus sign.)

Answer is not complete ALMWAY CORPORATION Balance Sheet At December 31, 2018 Assets Current assets Cash and cash equivalents $ 30,000 80,000 Short-term investments 60,000 Accounts receivable, net of allowance 200,000 Inventories 9,000 Prepaid insurance 379,000 Total current assets Investments Marketable securitie $ 30,000 Land held for sale 25,000 15,000 Restricted cash Total investments 70,000 Property, plant, and equipment 65,000 Land Buildings 420,000 Equipment 110,000 595,000 Less: Accumulated depreciation-buildings 100,000) (60,000) Less: Accumulated depreciation-equipment Net property, plant, and equipment 435,000 Intangible assets Patents 10,000 $ 894,000 Total assets Liabilities and Shareholders' Equity Current liabilities S 75,000 Accounts payable Interest payable 20,000 Notes payable 30,000 10,000 Current maturities of long-term debt Total current liabilities 135,000 Long-term liabilities Notes payable $ 90,000 Bonds payable 240,000 Total long-term liabilities 330,000 465,000 Shareholders' equity 300,000 Common stock Retained earnings 129,000 Total shareholders' equity 429,000 Total liabilities and shareholders' equity $ 894,000

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