Preparing a Balance Sheet with Missing or Inconsistent Information
The following information is provided for Tom’s Track Shoe Store at the end of 2000:
|
Accounts receivable |
$ 6,500 |
|
Accounts payable |
106,500 |
|
Bonds payable |
180,000 |
|
Invested capital |
300,000 |
|
Cash |
14,500 |
|
Equipment |
88,000 |
|
Income taxes payable |
11,500 |
|
Inventory |
497,500 |
|
Other long term assets |
110,000 |
|
Notes payable |
50,000 |
|
Prepaid rent |
54,000 |
|
Retained earnings, 12 31 99 |
94,500 |
|
Retained earnings, 12 31 00 |
? |
Required
a. Prepare a balance sheet, and make it balance. Discuss the steps necessary to balance it along with any necessary assumptions.
b. What conclusions can be drawn regarding this business? Why?