The following balance sheet for the Hubbard Corporation was prepared by the company: HUBBARD CORPORATION Balance Sheet

Question:

The following balance sheet for the Hubbard Corporation was prepared by the company:

HUBBARD CORPORATION

Balance Sheet

At December 31, 2018

Assets

Buildings ............................................................................... $ 750,000

Land .................................................................................... 250,000

Cash ...................................................................................... 60,000

Accounts receivable (net) ............................................................. 120,000

Inventories ............................................................................... 240,000

Machinery ................................................................................. 280,000

Patent (net) ............................................................................... 100,000

Investment in marketable equity securities ........................................... 60,000

Total assets ................................................................................ $1,860,000

Liabilities and Shareholders' Equity

Accounts payable ........................................................................ $ 215,000

Accumulated depreciation ..............................................................255,000

Notes payable .............................................................................500,000

Appreciation of inventories ............................................................. 80,000

Common stock, authorized and issued 100,000 shares of no par stock ..........430,000

Retained earnings ........................................................................380,000

Total liabilities and shareholders' equity.............................................. $1,860,000

Additional Information:

1. The buildings, land, and machinery are all stated at cost except for a parcel of land that the company is holding for future sale. The land originally cost $50,000 but, due to a significant increase in market value, is listed at $120,000. The increase in the land account was credited to retained earnings.

2. Marketable equity securities consist of stocks of other corporations and are recorded at cost, $20,000 of which will be sold in the coming year. The remainder will be held indefinitely.

3. Notes payable are all long-term. However, a $100,000 note requires an installment payment of $25,000 due in the coming year.

4. Inventories are recorded at current resale value. The original cost of the inventories is $160,000.

Required:

Prepare a corrected classified balance sheet for the Hubbard Corporation at December 31, 2018.

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