Business, 17.02.2020 17:42 Laylahlettiere

The bookkeeper for Geronimo Company has prepared the following balance sheet as of July 31, 2014.

GERONIMO COMPANY
BALANCE SHEET
AS OF JULY 31, 2014

Cash $69,000 Notes and accounts payable $44,000
Accounts receivable (net) 40,500 Long-term liabilities 75,000
Inventory 60,000 Stockholders's equity 155,500
Equipment (net) 84,000 $274,500
Patents 21,000
$274,500

The following additional information is provided.

1. Cash includes $1,200 in a petty cash fund and $15,000 in a bond sinking fund.
2. The net accounts receivable balance is comprised of the following two items: (a) accounts receivable $44,000 and (b) allowance for doubtful accounts $3,500.
3. Inventory costing $5,300 was shipped out on consignment on July 31, 2014. The ending inventory balance does not include the consigned goods. Receivables in the amount of $5,300 were recognized on these consigned goods.
4. Equipment had a cost of $112,000 and an accumulated depreciation balance of $28,000.
5. Income taxes payable of $6,000 were accrued on July 31. Geronimo Company, however, had set up a cash fund to meet this obligation. This cash fund was not included in the cash balance, but was offset against the income taxes payable amount.

Prepare a corrected classified balance sheet as of July 31, 2014, from the available information, adjusting the account balances using the additional information.

Answers: 3

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The bookkeeper for Geronimo Company has prepared the following balance sheet as of July 31, 2014.