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BlueCoast
Apr 21, 2007, 05:48 PM
Hi everyone! I need help in one of my homework questions. I spent the whole day trying to figure out this problem, and I'm lagging behind from this. Please help:

10.2B) Intruction:
Using the information provided, prepare the current and long-term liability sections of the company's balance sheet dated Dec. 31, 2005. (Within each classification, items amy be listed in any order.)

Information:
Note payable to Southern Bank....$250,000
Income taxes payable...15,000
accrued expenses and payroll taxes...26,000
mortgage note payable...750,000
accrued interest on mortgage note payable...15,000
trade accounts payable...275,000
unearned revenue...33,000
potential liability in pending lawsuit...2,000,000

Other Information:
1. The note payable to southern bank is due in 60 days. arrangements have been made to renew this note for an additional 24 months.
2. The mortgage requires payments of $10,000 per month. an amortization table shows that its balance will be paid down to $733,000 by Dec. 31, 2006.
3. Accrued interest on the mortgage note payable is paid monthly. the next payment is due near the end of the first week in Jan. 2006.
4. Atlanta Peach has been sued for $2,000,000 in a product damage case. it is not possible at this time, however, to make a reasonable estimate of the possible loss, if any, that the company may have sustained.

If you know anything about this problem. Please help me. Thank you so much!