Question

Carlos Ramirez and Camila Garza organized New World Book Store as a corporation, each contributed $80,000 cash to start the business and received 4,000 shares of common stock. The store completed its first year of operations on December 3. Current year on that date, the following financial items for the year were determine; December 31, current year, cash on hand and in bank, $75,600, December 31, current year, amounts due from customers from sales of books, $39,000, unused portion of store and office equipment. $73,000. December 31, current year amounts owed to publishers for books purchased $12,000 one-year note payable to a local bank for $3,000 with interest due of $300. No dividends were declared or paid to the stockholders during the year.

Complete a balance sheet as of the end of current year.

New world bookstore

Balance sheet

At December 31, current year

Assets                                                         Liabilities                  

Cash                                                           Accounts payable

Accounts receivable Note payable

store and office equipment Interest payable

                                                                   Total Liabilities

       Stockholders’ Equity

                                                                  Common stock

                                                                  Retained earning

                                                                  Total stockholder equity

                                                                 Total liabilities and stockholders’ equity

Answer 1

New world bookstore Balance sheet At December 31, current year Liabilities $75,600 Accounts payable $39,000 Note payable Store and office equipment $73,000 Interest payable Total Liabilities Assets $12,000 Cash Accounts receivable $3,000 $300 $15,300 Stockholders' Equity $80,000 Common stock Retained earning Total stockholder equity $92,300 $172,300 $187,600 Total liabilities and stockholders' equity $187,600 Total Assets Working Total Assets Total Liabilities Stockholders' Equity Total Assets Total Liabilities + Common Stock + Retained Earnings $187600 $15300 $80000+ Retained Earnings Retained Earnings $187600-$15300-$80000 $92300