Question 1

For each statement listed below, state whether it is correct or not
-The asset sections found on a classified balance sheet include current assets, current liabilities, and owners' equity.

Accepted Answer

The asset sections on a classified balance sheet typically include current assets, long-term investments, property, plant, and equipment, and intangible assets. Current liabilities and owners' equity are not classified as assets but as separate sections of the balance sheet.

Question 2

For each statement listed below, state whether it is correct or not
-Dividends payable, Inventories, Contributed capital, and Accumulated Depreciation all appear on a company's balance sheet.

Accepted Answer

Dividends payable is listed under current liabilities, inventories under current assets, contributed capital under shareholders' equity, and accumulated depreciation is subtracted from assets on a company's balance sheet.

Question 3

For each financial statement item listed below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all.
-Accumulated depreciation

Accepted Answer

Accumulated depreciation is reported under the category of Property, Plant, and Equipment (C) on the balance sheet as it reflects the total depreciation expense that has been recorded against a company's assets over their useful lives.

Question 4

For each financial statement item listed below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all.
-Trademarks

Accepted Answer

Trademarks are considered intangible assets because they represent a non-physical asset that provides value to a company, such as brand recognition.

Question 5

For each financial statement item listed below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all.
-Investment in bonds

Accepted Answer

Investment in bonds is typically classified as a long-term investment on the balance sheet if the company intends to hold the investment for more than one year.

Question 6

For each financial statement item listed below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all.
-Retained earnings

Accepted Answer

Retained earnings are reported under Shareholders' equity on the balance sheet because they represent the cumulative amount of net income earned by the company that has been retained (not distributed to shareholders as dividends) over its life.

Question 7

For each financial statement item listed below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all.
-Short-term investments

Accepted Answer

Short-term investments are classified as current assets because they are expected to be converted into cash or used up within one year or the operating cycle, whichever is longer.

Question 8

For each financial statement item listed below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all.
-Prepaid insurance

Accepted Answer

Prepaid insurance is classified as a current asset because it represents payments made in advance for insurance coverage that will benefit the company within one year or the operating cycle, whichever is longer.

Question 9

Given below are several accounts from Nicholas Company's accounting records.

Net income for the year was $20,000.How much is total shareholders' equity at the end of the year?

Accepted Answer

The answer of Given below are several accounts from Nicholas...

Question 10

Below are several amounts from Netcom Company's accounting records.Answer the questions that follow.
 Total assets, end of year $190,000
 Total liabilities, end of year 30,000
 Contributed capital, end of year 20,000
 Retained earnings, beginning of year 65,000
 Dividends for the period 15,000
 Net income 32,000
 
 A. Calculate the amount of retained earnings at the end of the year.
 B. If revenue amounts to $220,000, how much is 'total expenses'?
 C. How do you know the company has been profitable since it began operations?

Accepted Answer

The answer of Below are several amounts from Netcom Company's...

Question 11

Following are several items from Simmons Company's financial statements.Use this information to calculate the amounts for the questions that follow.

A.	Calculate the dollar amount of net income.
B.	How much is inventory expense? 
C.	Was the company profitable during the current year? How do you know?

Accepted Answer

The answer of Following are several items from Simmons Company's...

Question 12

At the beginning of 2010, Waterford Company sold stock and began operations.Information from Waterford's accounting records for the year ending December 31, 2010, follows:

A.Circle the names of any accounts above that would not be reported on the income statement.
B.Determine the amount of net income.

Accepted Answer

The answer of At the beginning of 2010, Waterford Company...

Question 13

The following are account balances of Marcia Company on 12/31/10.

Prepare a classified balance sheet for Marcia Company on December 31, 2010.

Accepted Answer

The answer of The following are account balances of Marcia...

Question 14

The following is the balance sheet of Lamont Corporation immediately prior to deciding how to finance the purchase of a $300 addition to its building.
  The bonds payable contract agreement requires current assets to be twice as much as current liabilities.Assume the $300 addition to the building is to be paid in cash and financed by issuing more stock.Calculate and explain the maximum cash that Lamont can pay and still honor its debt agreement.

Accepted Answer

The answer of The following is the balance sheet of...

Question 15

Below is all of the account information from Neville Company's balance sheet, with the exception of Retained Earnings.

Using this information, please calculate the following:
A.The total amount of retained earnings for Neville Company.
B.The total amount of shareholders' equity for the company at the end in the year.

Accepted Answer

The answer of Below is all of the account information...

Question 16

The following information is shown on Foreman Company's balance sheet.Answer the questions that follow.

A. How much did debt investors provide to Foreman Company?
B. What is the amount of money provided by equity investors to Foreman Company?
C. How much would be classified as property, plant, and equipment?

Accepted Answer

The answer of The following information is shown on Foreman...

Question 17

The following is the balance sheet of Cleveland Corporation immediately prior to deciding how to finance the purchase of an additional $200,000 parcel of land.
‪  
REQUIRED: Cleveland will finance the $200,000 investment in land by issuing either $200,000 of common stock or using $200,000 of additional accounts payable that will be due in 90 days.Indicate which method of financing is preferable for Cleveland.Consider the effects on short-term solvency positions.

Accepted Answer

The answer of The following is the balance sheet of...

Quiz 2: The Financial Statementsa Closer Look

For each statement listed below, state whether it is correct or not -The asset sections found on a classified balance sheet include current assets, current liabilities, and owners' equity.

For each statement listed below, state whether it is correct or not -Dividends payable, Inventories, Contributed capital, and Accumulated Depreciation all appear on a company's balance sheet.

For each financial statement item listed below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all. -Accumulated depreciation

For each financial statement item listed below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all. -Trademarks

For each financial statement item listed below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all. -Investment in bonds

For each financial statement item listed below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all. -Retained earnings

For each financial statement item listed below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all. -Short-term investments

For each financial statement item listed below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all. -Prepaid insurance

Given below are several accounts from Nicholas Company's accounting records. Net income for the year was $20,000.How much is total shareholders' equity at the end of the year?

The following are account balances of Marcia Company on 12/31/10. Prepare a classified balance sheet for Marcia Company on December 31, 2010.