60.1K

Verified Solution

Link Copied!

PROBLEM PRACTICE $5$

$13$

The following is a December $31,2021,$ post$-$closing trial balance for Almway Corporation.

$\backslash$table$[[\backslash$table$[[$Account Title$],[$Cash$],[$post$-$closing trial balance for Almway Corporation.$]]],[$Investment in equity,Debits,Credits$],[$Accounts receivable securities$,$$$51,000,$Credits$],[$Inventory$,116,{000}^{-},],[$Prepaid insurance $($for$,63,000,],[$Land$,203,000,],[$Buildings$,9,000,],[$Buildings$,96,000,],[$Accumulated depreciation$-$buildings,$423,000,],[$Equipment$,,$$ $103,000],[$Accumulated depreciation$-$equipment,$113,000,],[$Patent $($net$),,63,000],[$Accounts payable,$13,000,],[$Notes payable,,$81,000],[$Interest payable,,$139,000],[$Bonds Payable,,$23,000],[$Common stock,,$243,000],[,,309,000],[$Retained earnings,,$126,000],[$Totals$,$$$1,087,000,$$$1,087,000]]$

Additional information:

The investment in equity securities account includes an investment in common stock of another corporation of $$33,000$ which management intends to hold for at least three years. The balance of these investments is intended to be sold in the coming year.

The land account includes land which cost $$28,000$ that the company has not used and is currently listed for sale.

The cash account includes $$18,000$ restricted in a fund to pay bonds payable that mature in $2024$ and $$26,000$ restricted in a three$-$month Treasury bill.

The notes payable account consists of the following:

a$.$ a $$33,000$ note due in six months.

b$.$ a $$53,000$ note due in six years.

c$.$ a $$53,000$ note due in five annual installments of $$10,600$ each, with the next installment due February $15,2022.$

The $$63,000$ balance in accounts receivable is net of an allowance for uncollectible accounts of $$7,000.$

The common stock account represents $103,000$ shares of no par value common stock issued and outstanding. The corporation has $500,000$ shares authorized.

Answer & Explanation Solved by verified expert

See Answer