Problem: The following balance sheet was prepared by the bookkeeper for Sprint Company as of December 31, 2004
Sprint Company
Balance Sheet
December 31, 2004
Cash 90,000
Accounts receivable (net) 52,200
Inventories 57,000
Investments 76,300
Equipment (net) 86,000
Patents 32,000
TOTAL 393,500
Accounts payable 75,000
Long-term liabilities 110,000
Stockholders' equity 208,500
TOTAL 393,500
The following additional information is provided:
Question 1. Cash includes the cash surrender value of a life insurance policy $12,400 and a bank overdraft of $1,500 has been deducted.
Question 2. The net accounts receivable balance includes:
(a) Accounts receivable-debit balances $60,000
(b) Accounts receivable-credit balances $1,000
(c) Allowance for doubtful accounts $4,800
Question 3. Inventories do not include goods costing $5,000 shipped out on consignment. Receivables of $5,000 were recorded on these goods.
Question 4. Investments include investments in common stock, trading $24,000 and available for sale $43,300, and franchises $9,000
Question 5. Equipment costing $10,000 with accumulated depreciation $6,000 is no longer used and is held for sale. Accumulated depreciation on the other equipment is $40,000
Instructions:
Prepare a balance sheet in good form (stockholders' equity details can be omitted.)