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5. (Preparation of a Corrected Balance Sheet) Uhura Company has decided to expand its operations. The bookkeeper recently completed the balance sheet presented below in order to obtain additional funds for expansion.

UHURA COMPANY
BALANCE SHEET
FOR THE YEAR ENDED 2004
Current assets
Cash (net of bank overdraft of $30,000) $200,000
Accounts receivable (net) 340,000
Inventories at lower of average cost or market 401,000
Trading securities-at cost (fair value $120,000) 140,000
Property, plant, and equipment
Building (net) 570,000
Office equipment (net) 160,000
Land held for future use 175,000
Intangible assets
Goodwill 80,000
Cash surrender value of life insurance 90,000
Prepaid expenses 12,000
Current liabilities
Accounts payable 105,000
Notes payable (due next year) 125,000
Pension obligation 82,000
Rent payable 49,000
Premium on bonds payable 53,000
Long-term liabilities
Bonds payable 500,000
Stockholders' equity
Common stock, $1.00 par, authorized 400,000 shares, 290,000
issued 290,000
Additional paid-in capital 160,000
Retained earnings ?
Instructions
Prepare a revised balance sheet given the available information. Assume that the
accumulated depreciation balance for the buildings is $160,000 and for the office
equipment, $105,000. The allowance for doubtful accounts has a balance of $17,000. The pension obligation is considered a long-term liability.

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5. (Preparation of a Corrected Balance Sheet) Uhura Company has decided to expand its operations. The bookkeeper recently completed the balance sheet presented below in order to obtain additional funds for expansion.

UHURA COMPANY
BALANCE SHEET
FOR THE YEAR ENDED 2004
Current assets
Cash (net of bank overdraft of $30,000) $200,000
Accounts receivable (net) 340,000
Inventories at lower of average cost or market 401,000
Trading securities-at cost (fair value $120,000) ...

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  • MBA, California State University, Sacramento
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