The following balance sheet has been prepared by the accountant for Limestone Company as of June 3, 2024, the date on which the company is to file a voluntary petition of bankruptcy:

Additional Information

∙ If the company is liquidated, administrative expenses are estimated at $18,000.

∙ The accounts payable figure includes $10,000 in wages earned by the company’s 12 employees during May. No one earned more than $2,200 of that total.

∙ Liabilities do not include taxes of $14,000 owed to the U.S. government.

∙ Company officials estimate that 40 percent of the accounts receivable will be collected in a liquidation and that the inventory disposal will bring $80,000. The land and buildings will be sold together for approximately $310,000; the equipment should bring $130,000 at auction. Prepare a statement of financial affairs for Limestone Company as of June 3, 2024.

Transcribed Image Text:

Cash Accounts receivable (net) Inventory. Land.... Buildings (net) Equipment (net). Total assets.. LIMESTONE COMPANY Balance Sheet June 3, 2024 Assets Liabilities and Equities Accounts payable.... Notes payable-current (secured by equipment).. Notes payable-long term (secured by land and buildings).. Common stock Retained earnings.. Total liabilities and equities.. $ 3,000 65,000 88,000 100,000 300,000 180,000 $736,000 $ 98,000 250,000 190,000 120,000 78,000 $736,000