2. From the following particulars taken from the books of the United Steel Company, prepare a pro forma balance sheet, and a statement of profit and loss:
- Stocks of goods on hand from preceding year $4,964,792.
- Purchases $12,945,983.
- Sales $14,987,653.
- Sales salaries $52,500.
- Sales traveling expenses $8,613.
- Sales commissions $1,780.
- Cash $1,420,909.
- Executive salaries $32,500.
- Interest on notes payable $18,604.
- Rentals $17,000.
- Capital stock outstanding $38,669,600.
- Interest income including the accrued, $29,911.
- Real estate, plant, and equipment $34,469,867.
- Trade debtors $7,082,026.
- Notes receivable $302,638.
- Customers’ acceptances unmatured $4,446,000.
- Trade creditors $1,609,101.
- Notes payable $250,000.
- Repairs to plant $8,790.
- Investments in subsidiary companies $3,358,933.
- Advertising cost to date $35,680, exclusive of
- the amount prepaid.
- Telegraph $2,514.
- Telephone $8,716.
- Freight-out $4,978.
- Demurrage $1,972.
- Taxes expense $39,447, of which $17,017 is unpaid.
- Surplus without taking account of the current year’s
- profit is $13,678,362.
- Goods now on hand $7,004,339.
- Interest accrued on notes receivable $5,510.
- Prepaid advertising $11,892.
- Note: Show Interest Income Accrued as a current asset.
3. The warehouse of the Eastern Distributing Company is destroyed by fire. The records at the main offices showed that there were $785,960 worth of merchandise in the building on January 1, 19—.
The fire occurred on October 3, 19—, and to that date purchases had been made amounting to $2,486,475, of which $18,920 were not yet delivered. Included in the cost of purchases is $22,500 for freight paid.
Sales had amounted to $2,930,760. Statistical records for the ten years previous to the loss, showed a gross profit on sales of 51.42%.
The loss is complete except as to a small amount of goods salvaged, the realizable value of which is estimated at $125,000.
It is necessary, according to the terms of the fire insurance policy, to file an immediate claim for goods destroyed. Prepare such a claim, having due regard to a form suitable for showing the loss.
VIII
1. Draw up from your own data the balance sheet of a corporation, with at least twelve assets and at least five liabilities and a total asset figure of over $250,000.
2. Making your own assumptions set up a balance sheet for the succeeding year and a comparative balance sheet for the two years.