BE5-1

Current assets
Inventories......................................................... $290,000
Accounts receivable .......................................... $110,00
Less: Allowance for doubtful accounts ............. 8,000
102,000
Prepaid insurance.............................................. 9,500
Cash................................................................... 30,000
Total current assets........................... $431,500

E5-4

GULISTAN INC.
Statement of Financial Position
December 31
Assets
Non-current assets
Long-term investments
Long-term investment in
preference shares ........................... $XXX
Land held for future plant site...................... XXX
Cash restricted for plant expansion.............. XXX
Total l ong-term i nvestments.............. $XXX

Property, plant, and equipment

Buildings ............................................... XXX
Less: Accum. depreciation—
buildings ............................ XXX XXX

Intangible assets
Copyrights ...................................... XXX

Current assets
Inventories
Finished goods............ $XXX
Work in process ......... XXX
Raw materials............. XXX XXX
 Accounts receivable................ XXX
Less: Allowance for doubtful
accounts....................... ……… XXX XXX
Notes receivable .................... XXX
Receivables—officers................. XXX
Cash.................................... XXX
Less: Cash restricted for plant
expansion ........................ XXX XXX
Total current assets......... XXX
Total assets..................... $XXX

Equity and Liabilities

Equity
Share capital—ordinary .................................... XXX
Share premium—ordinary shares ..................... XXX
Retained ea rnings XXX
Less: Treasury shares, at cost .......................... (XXX)
Total shareholders’ equity ................... XXX
Total equity and liabilities .................. $XXX

Non-current liabilities
Bonds payable, due in four years...................... $XXX
Long-term note payable.................................... XXX
Total non-current liabilities.......................... $XXX

Current liabilities
Notes payable, short-term.................................... XXX
Accrued salaries payable..................................... XXX
Unearned subscriptions revenue ........................ XXX
Unearned rent revenue......................................... XXX
Total current liabilities............................. XXX XXX
Total liabilities ......................................... XXX

Note to instructor: An assumption made here is that cash included the cash restricted for plant
expansion. If it did not, then a subtraction from cash would not be necessary or the cash balance
would be “grossed up” and then the cash restricted for plant expansion deducted.
E5-12
VIVALDI CORPORATION
Statement of Financial Position
December 31, 2010
Assets
Non-current assets
Long-term investments
Investments in bonds................................ $299,000
Investments in capital shares.................... 277,000
Total long-term investments.......... $ 576,000

Property, plant, and equipment

Land ........................................................... 260,000
Buildings .................................................... $1,040,000
Less: Accum. depreciation ......................... 352,000 688,000
Equipment.................................................... 600,000
Less: Accum. depreciation........................... 60,000 540,000
Total property, plant, and equipment 1,488,000

Intangible assets
Franchise..................................................... 160,000
Patent........................................................... 195,000
Total intangible assets.............................. 355,000
Total non-current assets........................... 2,419,000

Current assets
Inventories .................................................... 597,000
Accounts receivable...................................... 435,000
Less: Allowance for doubtful accounts............... 25,000 410,000
Trading securities....................................... 153,000
 Cash.......................................................... 197,000
Total current assets.............................. 1,357,000
Total assets .......................................... $3,776,000

Equity and Liabilities

Equity
Share capital—ordinary ($5 par) ......... $1,000,000
Retained earnings* .................................. 130,000
Accumulated other comprehensive income 80,000
Less: Treasury shares................................ 191,000
Total equity .......................................... $1,019,000
Non-current liabilities
Bonds payable .......................................... $1,000,000
Long-term notes payable.......................... 900,000
Provision for pensions.............................. 80,000
Total non-current liabilities .............. 1,980,000
Current liabilities
Short-term notes payable...................... $ 90,000
Accounts payable ................................. 455,000
Dividends payable ................................ 136,000
Accrued liabilities ................................ 96,000
Total current liabilities .................. 777,000
Total liabilities............................... 2,757,000
Total equity and liabilities .............................. $3,776,000
E5-8
1. Dividends payable of $1,900,000 will be reported as a current liability [(1,000,000 –
50,000) X $2.00].
2. Bonds payable of $25,000,000 and interest payable of $2,000,000 ($100,000,000 X 8% X
3/12) will be reported as a current liability. Bonds payable of $75,000,000 will be
reported as a non-current liability.
3. Customer advances of $17,000,000 will be reported as a current liability ($12,000,000 +
$30,000,000 – $25,000,000).