"12. Classify the following balance sheet items as current or noncurrent:Retained earnings Bonds payableAccounts payable Accrued wages payablePrepaid expenses Accounts receivablePlant and equipment Capital in excess of parInventory Preferred stockCommon stock Marketable securities2-12. Solution: Retained earnings ? noncurrent Accounts payable? current Prepaid expense? current Plant and equipment? noncurrent Inventory? current Common stock? noncurrent Bonds payable? noncurrent Accrued wages payable? current Accounts receivable ? current Capital in excess of par? noncurrent Preferred stock? noncurrent Marketable securities ? current S2-16 13. Fill in the blank spaces with categories 1 through 7: 1. Balance sheet (BS)5. Current liabilities (CL) 2. Income statement (IS) 6. Long-term liabilities (LL) 3. Current assets (CA) 7. Stockholders’ equity (SE) 4. Fixed assets (FA)Indicate WhetherItem Is on Balance If on BalanceSheet (BS) or Sheet, DesignateIncomeWhich Statement (IS) Category Item_____ _____ Accounts receivable_____ _____ Retained earnings_____ _____ Income tax expense_____ _____ Accrued expenses_____ _____ Cash_____ _____ Selling and administrative expenses_____ _____ Plant and equipment_____ _____ Operating expenses_____ _____ Marketable securities_____ _____ Interest expense_____ _____ Sales_____ _____ Notes payable (6 months)_____ _____ Bonds payable, maturity 2009_____ _____ Common stock_____ _____ Depreciation expense_____ _____ Inventories_____ _____ Capital in excess of par value_____ _____ Net income (earnings after taxes)_____ _____ Income tax payable2-13. Solution: 1. Balance Sheet (BS) 2. Income Statement (IS) 3. Current Assets (CA) 4. Fixed Assets (FA) 5. Current Liabilities (CL) 6. Long-Term Liabilities (LL) 7. Stockholders Equity (SE)S2-17 2-13. (Continued)Indicate If the ItemWhether the is onitem is on BalanceIncome Sheet,Statement or DesignateBalance WhichSheet Category ItemBS CA Accounts ReceivableBS SE Retained EarningsISIncome Tax ExpenseBS CL Accrued ExpensesBS CA CashISSelling and Administrative expensesBS FA Plant & EquipmentISOperating ExpensesBS CA Marketable SecuritiesISInterest ExpenseISSalesBS CL Notes Payable (6 months)BS LL Bonds payable (Maturity 2009)BS SE Common StockISDepreciation ExpenseBS CA InventoriesBS SE Capital in excess of par valueISNet Income (Earnings after Taxes)BS CL Income tax payableS2-18 14. Arrange the following items in proper balance sheet presentation:Accumulated depreciation............................. ........................ $200,000Retained earnings.................................... ............................... 110,000Cash........................................................................................ 5,000Bonds payable........................................ ................................ 142,000Accounts receivable.................................. ............................. 38,000Plant and equipment ?.................... original cost.................... 720,000Accounts payable..................................... .............................. 35,000Allowance for bad debts.............................. .......................... 6,000Common stock, $1 par, 150,000 shares outstanding..... ........ 150,000Inventory............................................ .................................... 66,000Preferred stock, $50 par, 1,000 shares outstanding... ............ 50,000Marketable securities................................ ............................. 15,000Investments.......................................... .................................. 20,000Notes payable........................................ ................................. 83,000Capital paid in excess of par (common stock)......... .............. 88,0002-14. Solution:AssetsCurrent Assets:Cash............................................$ 5,000Marketable securities ................... 15,000Accounts receivable ..................... $ 38,000Less: Allowance for bad debts6,000 32,000Inventory ......................................66,000Total Current Assets ................$118,000Other Assets:Investments .................................. 20,000Fixed Assets:Plant and equipment ..................... $720,000Less: Accumulated depreciation 200,000Net plant and equipment .............. 520,000Total Assets ............................. $658,000S2-19 2-14. (Continued)Liabilities and Stockholders’ EquityCurrent Liabilities: Accounts payable......................................................$35,000Notes payable ........................................................... 83,000Total current liabilities ..........................................$118,000Long-term Liabilities ..................................................Bonds payable ..........................................................142,000Total Liabilities .....................................................$260,000Stockholders’ Equity: Preferred stock, $50 par, 1,000 shares outstanding ..50,000Common stock, $1 par, 150,000 shares outstanding150,000Capital paid in excess of par (common stock)..........88,000Retained earnings .....................................................110,000Total Stockholders’ Equity....................................$398,000Total Liabilities and Stockholders’ Equity ........$658,000S2-20 "