Question

Ayayai Corp. has decided to expand its operations. The bookkeeper recently completed the following statement of financial position in order to obtain additional funds for expansion:

AYAYAI CORP. Statement of Financial Position For the Year Ended December 31, 2017
Current assets
	Cash (net of bank overdraft of $31,000)		$	270,000
	Accounts receivable (net)			349,000
	Inventory at the lower of cost and net realizable value			411,000
	FV-NI investments (at cost—fair value $130,000)			150,000
Property, plant, and equipment
	Building (net)			580,000
	Equipment (net)			170,000
	Land held for future use			185,000
Intangible assets
	Goodwill			81,000
	Investment in bonds to be held until maturity, at amortized cost			91,000
	Prepaid expenses			13,000
Current liabilities
	Accounts payable			205,000
	Notes payable (due next year)			135,000
	Pension obligation			83,000
	Rent payable			50,000
Long-term liabilities
	Bonds payable			564,000
Shareholders’ equity
	Common shares, unlimited authorized, 300,000 issued			300,000
	Contributed surplus			190,000
	Retained earnings			?

(a)

Prepare a revised statement of financial position using the available information. Assume that the bank overdraft relates to a bank account held at a different bank from the account with the cash balance. Assume that the accumulated depreciation balance for the buildings is $170,000 and that the accumulated depreciation balance for the equipment is $115,000. The allowance for doubtful accounts has a balance of $18,000. The pension obligation is considered a long-term liability. (List Current Assets in order of liquidity. List Property, Plant and Equipment in order of Land, Buildings and Equipment.)

Answer 1

Page No 0 Aşşets Particulars and Amount Current Assets cash ( 31,000+ 270000) $ 300,000 Accounts receivable (349000+ 18000) $ 367,000 Inventory $ 411,000 Fy-Ne investment Cfair value) $ 130,000 Prepaid Expenses. $ 131000 Total & 1222 1000 Long Term Assets Building 580000 + 140,000 Equipment 140,000 + 115,000 $450000 $ 285000 Total $ 1035000 Long Term investments hand Investments $185.000 $91,000 $ 276.000 Total Intangible Assets Good will $ 81,000 $81.000 - Total

Pageno Total Assets Current Assets Longterm Assets + Longterm investment & Intangiable Assets = 1,222,000 + 1035000 + 946000 +81000 Total Assetę = $2614,000 Liabilitieli Amount Particulara Current liabilities Accounts payable Noted Payable Rent payable Bank overdraft $ 205,000 $ 135,000 $ 50,000 $ 31,000 Total $421,000 non Current liabilite? $18,000 Allowance for doubtfel debts Accumulated Depreciation Building $170,000 $ 15,000 $ 303 000 I quipment Total

Pageno Amount 564.000 83,000 644000 - Particulares Long Term Liabilities Bond & payable Pension obligation . Total owners Equity Commont Stock Contributed surplus Retained Earnings Total . 300,000 190.000 +5,3000 124 3000 Total liabilities = current liabilitiel + NonCurrent liabilitel + long term liabilited + owner Equity = 421,000 + 30300 0 +644000 +1243000 Total liabilitiel = $2614000