Intermediate Accounting: P3-6 post-closing trial balance for the Vosburgh Electronics Corporation

Important Reminder!!! There are other versions of this problem - amounts and dates have been changed - so please make sure you review and compare this tutorial to the problem in your homework.

Intermediate Accounting

P3-6 Balance sheet preparation; disclosures
The following is a December 31, 2013, post-closing trial balance for the Vosburgh Electronics Corporation.
Account Title Debits Credits
Cash 67,000
Short-term investments 182,000
Accounts receivable 123,000
Long-term investments 35,000
Inventories 215,000
Loans to employees 40,000
Prepaid expenses (for 2014) 16,000
Land 280,000
Building 1,550,000
Machinery and equipment 637,000
Patent 152,000
Franchise 40,000
Note receivable 250,000
Interest receivable 12,000
Accumulated depreciation—building 620,000
Accumulated depreciation—equipment 210,000
Accounts payable 189,000
Dividends payable (payable on 1/16/14) 10,000
Interest payable 16,000
Taxes payable 40,000
Unearned revenue 60,000
Notes payable 300,000
Allowance for uncollectible accounts 8,000
Common stock 2,000,000
Retained earnings 146,000
Totals $3,599,000 $3,599,000

Additional information:
1. The common stock represents 1 million shares of no par stock authorized, 500,000 shares issued and outstanding
2. The loans to employees are due on June 30, 2014
3. The note receivable is due in installment $50,000, payable on each September 30. Interest is payable annually.
4. The short-term investments consist of marketable equity securities that the company plans to sell in 2014 and $50,000 in treasury bills purchased on December 15 of the current year that mature on February 15, 2014. Long term investments consist of marketable equity securities that the company does not plan to sell in the next year.
5. Unearned revenue represents customer payments for extended service contracts. Eighty percent of these contracts expire in 2014, the remainder in 2015.
6. Notes payable consists of two notes, one for $100,000 due on January 15, 2015 and another for $200,000 due on June 30, 2016.

Required:
1. Prepare a classified balance sheet for Vosburgh at December 31, 2013.
2. Identify the items that would require additional disclosure, either on the face of the balance sheet or in a disclosure note.
Powered by