Ch.2 Q1 Trial Balance & Current Ratio PDF

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10/24/2020

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Jaguar Plastics Company has been operating for three years. At December 31 of last year, the accounting records reflected the following: Cash Investments (short-term) Accounts receivable Inventory Notes receivable (long-term) Equipment Factory building Intangibles

$20,000 Accounts payable 4,000 Accrued liabilities payable 3,200 Notes payable (current) 25,000 Notes payable (noncurrent) 1,500 Common stock 48,000 Additional paid-in capital 94,000 Retained earnings 4,900

$14,000 2,400 5,900 49,000 9,300 83,700 36,300

During the current year, the company had the following summarized activities: a. Purchased short-term investments for $8,200 cash. b. Lent $5,100 to a supplier who signed a two-year note. c. Purchased equipment that cost $25,000; paid $4,500 cash and signed a one-year note for the balance. d. Hired a new president at the end of the year. The contract was for $79,000 per year plus options to purchase company stock at a set price based on company performance. The new president begins her position on January 1 of next year. e. Issued an additional 1,900 shares of $0.50 par value common stock for $12,000 cash. f. Borrowed $13,000 cash from a local bank, payable in three months. g. Purchased a patent (an intangible asset) for $1,900 cash. h. Built an addition to the factory for $28,000; paid $7,200 in cash and signed a three-year note for the balance. i. Returned defective equipment to the manufacturer, receiving a cash refund of $1,300.

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Requirement

General Journal

General Ledger

Trial Balance

Balance Sheet

Analysis

Your choice will determine the reported values on the financial statement tabs. JAGUAR PLASTICS COMPANY Trial Balance December 31, 2021 Account Title

Debit

Credit



Cash



Accounts receivable

3,200



Notes receivable (long-term)

6,600



$

19,400

Inventory

25,000



Short-term investments

12,200



Equipment

71,700



Factory building



Intangibles

  

122,000 6,800

Accounts payable

14,000

Notes payable (current)

39,400

Accrued liabilities payable

2,400



Notes payable (noncurrent)

69,800



Common stock

10,250



Additional paid-in-capital

94,750



Retained earnings

36,300 $

Total

General Ledger

266,900 $

266,900

Balance Sheet

 References General Ledger

Difficulty: 3 Hard

Learning Objective: 02-04 Determine the impact of business transactions on the balance sheet using two basic tools: Journal entries and T-accounts.

P2-3 (Algo) Recording Transactions in TAccounts, Preparing the Balance Sheet from a Trial Balance, and Evaluating the Current Ratio LO2-2, 2-4, 2-5 (GL)

Learning Objective: 02-02 Identify what constitutes a business transaction and recognize common balance sheet account titles used in business.

Learning Objective: 02-05 Prepare a trial balance and simple classified balance sheet and analyze the company using the current ratio.

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Jaguar Plastics Company has been operating for three years. At December 31 of last year, the accounting records reflected the following:

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Assignment Print View Cash Investments (short-term) Accounts receivable Inventory Notes receivable (long-term) Equipment Factory building Intangibles

$20,000 Accounts payable 4,000 Accrued liabilities payable 3,200 Notes payable (current) 25,000 Notes payable (noncurrent) 1,500 Common stock 48,000 Additional paid-in capital 94,000 Retained earnings 4,900

$14,000 2,400 5,900 49,000 9,300 83,700 36,300

During the current year, the company had the following summarized activities: a. Purchased short-term investments for $8,200 cash. b. Lent $5,100 to a supplier who signed a two-year note. c. Purchased equipment that cost $25,000; paid $4,500 cash and signed a one-year note for the balance. d. Hired a new president at the end of the year. The contract was for $79,000 per year plus options to purchase company stock at a set price based on company performance. The new president begins her position on January 1 of next year. e. Issued an additional 1,900 shares of $0.50 par value common stock for $12,000 cash. f. Borrowed $13,000 cash from a local bank, payable in three months. g. Purchased a patent (an intangible asset) for $1,900 cash. h. Built an addition to the factory for $28,000; paid $7,200 in cash and signed a three-year note for the balance. i. Returned defective equipment to the manufacturer, receiving a cash refund of $1,300.

Requirement

General Journal

General Ledger

Trial Balance

Balance Sheet

Analysis

Compute the current ratio for the current year. (Round your answer to 2 decimal places.)

Compute the current ratio for the current year.

Current ratio

1.07

Balance Sheet

Balance Sheet

 Explanation: No further explanation details are available for this problem. 

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