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Balance sheet preparation ? LO3?2, LO3?3




Question;Question 1Balance sheet preparation? LO3?2, LO3?3Presented below is the balance sheet for HHD, Inc., at December 31, 2013.The captions shown in the summarized statement above include the following:a. Current assets: cash, $150,000, accounts receivable, $200,000, inventories, $225,000, and prepaid insurance, $25,000.b. Investments: investments in common stock, short term, $90,000, and long term, $160,000, and bond sinking fund, $250,000.c. Property, plant, and equipment: buildings, $1,500,000 less accumulated depreciation, $600,000, equipment, $500,000 less accumulated depreciation, $200,000, and land, $800,000.d. Intangible assets: patent, $110,000, and copyright, $90,000.e. Current liabilities: accounts payable, $100,000, notes payable, short term, $150,000, and long term, $90,000, and taxes payable, $60,000.f. Long-term liabilities: bonds payable due 2018.g. Shareholders' equity: common stock, $1,000,000, retained earnings, $800,000. Five hundred thousand shares of no par common stock are authorized, of which 200,000 shares were issued and are outstanding.Required:Prepare a corrected classified balance sheet for HHD, Inc., at December 31, 2013.Page 160Question 2The following income statement items appeared on the adjusted trial balance of Schembri Manufacturing Corporation for the year ended December 31, 2013 ($ in 000s): sales revenue, $15,300, cost of goods sold, $6,200, selling expenses, $1,300, general and administrative expenses, $800, interest revenue, $85, interest expense, $180. Income taxes have not yet been accrued. The company's income tax rate is 40% on all items of income or loss. These revenue and expense items appear in the company's income statement every year. The company's controller, however, has asked for your help in determining the appropriate treatment of the following nonrecurring transactions that also occurred during 2013 ($ in 000s). All transactions are material in amount.1. Investments were sold during the year at a loss of $220. Schembri also had unrealized gains of $320 for the year on investments.2. One of the company's factories was closed during the year. Restructuring costs incurred were $1,200.3. An earthquake destroyed a warehouse causing $2,000 in damages. The event is considered to be unusual and infrequent.4. During the year, Schembri completed the sale of one of its operating divisions that qualifies as a component of the entity according to GAAP. The division had incurred a loss from operations of $560 in 2013 prior to the sale, and its assets were sold at a gain of $1,400.5. In 2013, the company's accountant discovered that depreciation expense in 2012 for the office building was understated by $200.6. Foreign currency translation losses for the year totaled $240.Required:1. Prepare Schembri's single, continuous multiple-step statement of comprehensive income for 2013, including basic earnings per share disclosures. One million shares of common stock were outstanding at the beginning of the year and an additional 400,000 shares were issued on July 1, 2013.2. Prepare a separate statement of comprehensive income for 2013.Page 221Question 3Integration of financial statements, Chapters 3 and 4? LO4?9The chief accountant for Grandview Corporation provides you with the company's 2013 statement of cash flows and income statement. The accountant has asked for your help with some missing figures in the company's comparative balance sheets. These financial statements are shown next ($ in millions).Page 223Required:1. Calculate the missing amounts.2. Prepare the operating activities section of Grandview's 2013 statement of cash flows using the indirect method.


Paper#40189 | Written in 18-Jul-2015

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