QUESTION1 The balance sheet items for Al\'s Pizza Shop (arranged in alphabetical

Question

QUESTION1 The balance sheet items for Al's Pizza Shop (arranged in alphabetical order) were as follows at August 01, 2018. Note: The value for Retained Earnings is missing $210,000 Accounts Receivable$ 9,000 $ 18,000 $ 29,000 $190,000 Building Supplies Notes Payable $ 8,400 $78,000 Equipment and FixturesS 20,000 Salaries Payable S 5,000 $160,000 Accounts Payable Cash Capital Stock Land During the next few days, the following transactions occurred Additional capital stock was sold for $40,000. The business has paid the accounts payable in full. The business has yet to make any payment on the notes payable or salaries payable. August 8 A new pizza oven was purchased at a cost of $8,000 to be paid within 25 days. New Supplies (pizza cutters and boxes) were purchased for $2,200 cash from a restaurant supply center that was going out of business. These supplies would have cost $3,900 if purchased through normal channels. August 12 Instructions a. Prepare a balance sheet at August 1, 2018. Include a proper heading and organize your balance sheet following the GAAPs format. Prepare a balance sheet at August 15, 2018. Include a proper heading and organize your balance sheet following the GAAPs format b. o search

Explanation / Answer

Working Note

A. property ,plant and equipments include

Land $ 160000

equipment $ 20000

.BUILDING $ 210000

B. capital stock is a part of perferres stock

wORKING nOTE

a. Adjustment in Cash

Opening Cash balance $29000

Add:-issue of capital stock $40000

less Account payable $18000

Less purchase of supllies $ 2200

BALANCE AS ON 15 AUG $48800

B.PIZZA OVEN is part of Property, Plant, and Equipment .

3.

4.As on 15 August company has more strong financial condition

because Current r ation of company as on 1 Aug is

=Current assets /Current Liabilies =390000/101000 =3.86

Current ratio as on 15 aug is

=398000/91000 =4.37

Balance Sheet of Al's pizza Shop as on 1st August 2018 Assets Amount Current Assets Cash and Cash Equivalents $ 29,000 Accounts Receivable, net of allowance for doubtful accounts $ 9,000 Inventory $ 8,400 Short-Term Investments Prepaid Expenses Long-Term Assets Property, Plant, and Equipment, net of depreciation $ 390,000 Long-Term Investments Intangible Assets Investments Accounted for Using the Equity Method (between 20-50% ownership) Total Assets $ 436,400 Liabilities Current Liabilities Accounts Payable $ 23,000 Notes Payable – Current $ 78,000 Unearned Revenue Income Tax Payable Long-Term Liabilities Long-Term Debt Other Long-Term Liabilities Stockholder’s Equity Retained Earnings $ 145,400 Common Stock Preferred Stock $ 190,000 Treasury Stock Total Liabilities and Equity (needs to equal total assets): $ 436,400

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