These items are taken from the financial statements of Sunland Company at Decemb

Question

These items are taken from the financial statements of Sunland Company at December 31, 2017.

Prepare a classified balance sheet. Assume that $13,872 of the note payable will be paid in 2018. (List current assets in order of liquidity and property plant and equipment in order of land, buildings and equipment.)

Assets

Liabilities and Stockholders' Equity

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Buildings $107,916 Accounts receivable 12,852 Prepaid insurance 3,264 Cash 12,077 Equipment 84,048 Land 62,424 Insurance expense 796 Depreciation expense 5,406 Interest expense 2,652 Common stock 61,200 Retained earnings (January 1, 2017) 40,801 Accumulated depreciation—buildings 46,512 Accounts payable 9,690 Notes payable 95,472 Accumulated depreciation—equipment 19,094 Interest payable 3,672 Service revenue 14,994

Explanation / Answer

Classified balance sheet

Assets Current assets Cash 12077 Accounts receivable 12852 Prepaid insurance 3264 Total current assets 28193 Long term investment Property, plant and equipment Land 62424 Equipment 84048 Less: Accumulated depreciation—equipment -19094 64954 Building 107916 Less: Accumulated depreciation—buildings -46512 61404 Total property, plant and equipment 188782 Intangible assets Other assets Total assets 216975 Liabilities and stockholder's equity Current liabilities Account payable 9690 Interest payable 3672 Notes payable 13872 Total current liabilities 27234 Long term liabilities Notes payable 81600 Total long term liabilities 81600 Total liabilities 108834 Stockholder's equity Common Stock 61200 Retained earnings 46941 Total Stockholder's equity 108141 Total liabilities and stockholder's equity 216975

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