Please refer to the instructions and the table in this question. Enter the correct journal entry for
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Question:
Please refer to the instructions and the table in this question. Enter the correct journal entry for part [A] in the following Balance Sheet and Income Statement for 20X1 and 20X2. Note that for the purpose of preparing the Balance Sheet at the end of each year:
- For investments, you need to classify whether they are current assets (i.e., short-term investment) or non-current assets (i.e., long-term investment);
- For bonds, you need to determine what portion of the bonds payable is current liability and what portion is non-current liability. Current portion of the bonds payable is the principal payment portion of the cash interest payments in the next year. Non-current portion is the remaining amount of the bonds payable; and
- For leases (as the lessee), you need to determine what portion of the lease obligation is current liability and what portion is non-current liability. Current portion of the lease obligation is the principal payment portion of the cash lease payment in the next year (i.e., the amortization amount of the lease obligation in the next year). Non-current portion is the remaining amount of the lease liability.
Project 3.3 Balance Sheet
Illini Company, Inc. | ||
Balance Sheet | ||
12/31/20X1 | 12/31/20X2 | |
Assets | ||
Current Assets | ||
Cash | $1,336,056 | $1,922,356 |
Short-term investment | [A] | [B] |
Accounts receivable, net of allowance | 34,150 | 67,800 |
Interest Receivable | 9,636 | 6,999 |
Prepaid insurance | 6,000 | 0 |
Inventory | 310,000 | 50,000 |
Total current assets | 1,733,841 | 2,047,155 |
Long-term investment | [C] | [D] |
PPE, net | 142,300 | 57,500 |
ROU assets, net | 137,076 | 101,345 |
Investment in lease | [E] | [F] |
Brand asset | 0 | 16,000 |
Goodwill | [G] | [H] |
Total assets | [I] | [J] |
Liabilities and shareholders' equity | ||
Current liabilities: | ||
Wage payable | [K] | [L] |
Unearned revenue | 0 | 50,000 |
Estimated warranty liability | 11,000 | 6,000 |
Accrued interest | 12,704 | 9,445 |
Current portion of long-term bonds | [M] | [N] |
Current portion of lease obligation | [O] | [P] |
Total current liabilities | 66,786 | 121,609 |
Non-current portion of long-term bonds | [Q] | [R] |
Non-current portion of lease obligation | [S] | [T] |
Pension liability | 2,000 | 9,800 |
Total liabilities | 286,437 | 236,341 |
Shareholders' equity: | ||
Common stock | [U] | [V] |
Additional paid-in capital - common stock | 280,000 | 316,600 |
Preferred stock | 100,000 | 100,000 |
Treasury stock | [W] | [X] |
Retained earnings | [Y] | [Z] |
Accumulated other comprehensive income | [i] | [ii] |
Total shareholders' equity | 1,919,138 | 2,070,652 |
Total liabilities and shareholders' equity | $2,205,575 | $2,306,992 |
Related Book For
Introduction to Corporate Finance What Companies Do
ISBN: 978-1111222284
3rd edition
Authors: John Graham, Scott Smart
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