Prepare a classified balance sheet for bl landscapes

Assignment Help Accounting Basics
Reference no: EM131810225

Bill Graham started his career mowing lawns for neighbors while he was in junior high school. Bill worked summers for the local golf course while he was in high school and after he graduated, he started his own lawn care business, Bill's Lawn Care. In addition to lawn care, he also sells two types of fertilizer. Bill is ready to expand his business and wants to add sprinkler systems to his product offering. Larry Miller has an established sprinkler system business and they have agreed to merge their two businesses together. They considered the partnership form of business but have decided to incorporate. You are taking an accounting class at the local community college and have been helping Bill keep the accounting records for his business. He has asked you to stay on and establish and maintain the accounting records for the new company, B&L Landscapes, Inc.

Bill and Larry have hired an attorney and filed the incorporation paperwork with the state of Colorado. In the articles of incorporation, they are authorized to issue 150,000 shares of $1 par value common stock and 5,000 shares of $100 par value, 5%, non-cumulative, non-participating preferred stock. The new corporation will be created on July 1, 2014. The fair value of the assets and liabilities of both companies are as follows:

 

 

Account

 

 

Bill's Lawn Care

Cash

$12,500

Accounts Receivable

500

Prepaid Insurance

500

Inventory

1,000

Land

8,000

Building

25,000

Equipment

7,500

Accounts Payable

5,000

Notes Payable (due 4/30/2024)

45,000

 

 

 

Larry's Sprinkler Systems

Cash

$10,000

Accounts Receivable

3,000

Prepaid Insurance

1,000

Inventory

5,000

Equipment

11,000

Accounts Payable

5,000

Bill and Larry have decided that they will each receive 1 share of common stock for every dollar of working capital (assets less liabilities) they contribute to the new company. You may assume that all the assets and liabilities listed above will be part of the new company. Additionally, they issue stock as follows:

Jul 1 Issued 30 shares of preferred stock for $100 per share cash to Bill's father.

Jul 1 Issued 20 shares of preferred stock for $100 per share cash to Larry's mother.

Instructions:

Using the chart of accounts provided below, and the Excel template provided with this assignment, prepare journal entries, in good form, to record the creation of B&L Landscapes, Inc. and the issuance of stock. Use July 1 for the creation journal entries. Start with Page 1 of the General Journal. Explanations are optional. 

Prepare a classified balance sheet for B&L Landscapes, Inc. for July 1, 2014.

During the first year of operations, B&L Inc. earned net income of $22,500. They also declared a $2,000 dividend on June 10, 2015 payable on June 30, 2015. Prepare an allocation of the dividend to each class of stock. 

Record the journal entries for the dividend declaration and payment on Page 2 of the General Journal. Explanations are optional.

Prepare the Stockholders' Equity section of the balance sheet for June 30, 2015.

B&L Landscapes, Incorporated

Chart of Accounts

Classification

Account Number

Account Name

ASSETS

101

Cash

 

110

Accounts Receivable

 

112

Allowance for Doubtful Accounts

 

115

Notes Receivable

 

116

Interest Receivable

 

120

Supplies

 

130

Prepaid Insurance

 

140

Inventory

 

150

Land

 

152

Building

 

153

Equipment

 

155

Accumulated Depreciation - Building

 

156

Accumulated Depreciation - Equipment

LIABILITIES

201

Accounts Payable

 

220

Notes Payable

 

225

Interest Payable

 

280

Dividend's Payable

STOCKHOLDERS' EQUITY  

301

Common Stock

 

310

Preferred Stock

 

330

Cash Dividends

 

350

Retained Earnings

REVENUES

401

Lawn Service Revenue

 

410

Sales Revenue

 

415

Sales Returns and Allowances

 

420

Interest Income

COST OF GOODS SOLD

501

Purchases

 

505

Purchase Returns and Allowances

EXPENSES

620

Supplies Expense

 

630

Fuel Expense

 

640

Repair and Maintenance Expense

 

650

Advertising Expense

 

65

Organization Expense

 

660

Insurance Expense

 

670

Depreciation Expense

 

680

Interest Expense

 

690

Bad Debt Expense

Reference no: EM131810225

Questions Cloud

What is the probability that a tosses the first head : Suppose that A and B take turns in tossing a biased coin which lands heads with probability p. Suppose that A tosses first.
What the ending accounts payable balance for Tidbit Inc : Tidbit Inc. has a sales budget for next month of $800,000. What will be the ending accounts payable balance for Tidbit Inc
Prepare a capital projects fund balance sheet : Prepare all journal entries (budgetary & actual), including closing entries, to record the Capital Projects Fund transactions for 20X3 and 20X4.
Calculate distribution of number of times a and b must toss : Suppose that A tosses a coin which lands heads with probability PA, and B tosses one which lands heads with probability PB.
Prepare a classified balance sheet for bl landscapes : Using the chart of accounts provided below, and the Excel template provided with this assignment, prepare journal entries
Audit of significant events or transactions : ACC707 - Communicating Key Audit Matters in the Independent Auditor's Report is developed in the wake of the global financial crisis
Federal income tax on their joint income tax return : Bill and Valerie have agreed that Valerie should continue working only until the federal income tax on their joint income tax return becomes $11,500.
What is his combined incremental tax rate : An unmarried individual in California with a taxable income of about $80,000 has a federal incremental tax rate of 28% and a state incremental tax rate
Compare the level of returns with the prior year : Expand testing of sales returns after year-end and compare the level of returns with the prior year.

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd