Can you please solve part B Problem 5-6 (Part Level Submission) LANSBURY INC. BA
ID: 2404022 • Letter: C
Question
Can you please solve part B
Problem 5-6 (Part Level Submission)
LANSBURY INC.
BALANCE SHEET
DECEMBER 31, 2016
(a)
Adjustments to reconcile net income to
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(b)
Assets
Liabilities and Stockholders' Equity
Can you please solve part B
Problem 5-6 (Part Level Submission)
Lansbury Inc. had the following balance sheet at December 31, 2016.LANSBURY INC.
BALANCE SHEET
DECEMBER 31, 2016
During 2017, the following occurred.
1. Lansbury Inc. sold part of its investment portfolio for $15,000. This transaction resulted in a gain of $3,400 for the firm. The company classifies its investments as available-for-sale. 2. A tract of land was purchased for $13,000 cash. 3. Long-term notes payable in the amount of $16,000 were retired before maturity by paying $16,000 cash. 4. An additional $20,000 in common stock was issued at par. 5. Dividends of $8,200 were declared and paid to stockholders. 6. Net income for 2017 was $32,000 after allowing for depreciation of $11,000. 7. Land was purchased through the issuance of $35,000 in bonds. 8. At December 31, 2017, Cash was $37,000, Accounts Receivable was $41,600, and Accounts Payable remained at $30,000.
Explanation / Answer
ASSETS $ LIABILITIES $ Current Assets: Current Liabilities: Cash in Bank $18,500.00 Accounts Payable $4,800.00 Petty Cash $500.00 Wages Payable $14,300.00 Net Cash $19,000.00 Office Rent — Inventory $25,400.00 Utilities $430.00 Accounts Receivable $5,300.00 Federal Income Tax Payable $2,600.00 Prepaid Insurance $5,500.00 Overdrafts — Total Current Assets $55,200.00 Customer Deposits $900.00 Pension Payable $720.00 Fixed Assets: Union Dues Payable — Land $150,000.00 Medical Payable $1,200.00 Buildings $330,000.00 Sales Tax Payable Less Depreciation $50,000.00 Total Current Liabilities $24,950.00 Net Land & Buildings $430,000.00 Long-Term Liabilities: Equipment $68,000.00 Long-Term Loans $40,000.00 Less Depreciation $35,000.00 Mortgage $155,000.00 Net Equipment $33,000.00 Total Long-Term Liabilities $195,000.00 TOTAL LIABILITIES $219,950.00 Owners' Equity: Common Stock $120,000.00 Owner - Draws $50,000.00 Retained Earnings $128,250.00 Total Owners' Equity: $298,250.00 TOTAL ASSETS $518,200.00 LIABILITIES AND EQUITY $518,200.00