Question

Charlie’s Crispy Chicken (CCC) operates a fast-food restaurant. When accounting for its first year of business, CCC created several accounts. Account Name Balance Description Accounts Payable $ 2,900 Payment is due in 30 days Cash 2,300 Includes cash in register and in bank account Common Stock 36,000 Stock issued in exchange for owners’ contributions Equipment 49,000 Includes deep fryers, microwaves, dishwasher, etc. Land 23,400 Held for future site of new restaurant Note Payable (long-term) 34,000 Payment is due in six years Retained Earnings 3,900 Total earnings through September 30 Supplies 2,300 Includes serving trays, condiment dispensers, etc. Salaries and Wages Payable 200 Payment is due in 7 days 1. Using the above descriptions, prepare a classified balance sheet at September 30.

Answer 1

Answer:

Charlie’s Crispy Chicken (CCC) Balance sheet at September 30

Assets

Non- Current Assets

Equipment                                     49,000

Land                                               23,400

Total Non- Current Assets            72,400

Current Assets

Supplies                                           2,300

Cash                                                 2,300

Total Current Assets                       4,600

Total Assets                                   77,000

Equity and Liabilities

Equity

Common Stock                             36,000

Retained Earnings                          3,900

Total Equity                                   39,900

Liabilities

Non-current Liabilities

Note Payable (long-term)            34,000

Total Non-current Liabilities        34,000

Current Liabilities

Accounts Payable                         2,900

Salaries and Wages Payable           200

Total Current Liabilities                  3,100

Total Equity and Liabilities          77,000

Explanation:

When preparing a Balance Sheet, it is important to remember the Accounting equation : Assets = Equity + Liabilities