ACC – Blues Corporation’s

1. Blues Corporation’s trial balance included the following account balances at December 31, 2011:Accounts Payable …………………………………. $45,000Bonds Payable, due 2012 …………………………… 75,000Discount on Bonds Payable, due 2012 ………………… 9,000Dividends Payable January 31, 2012 …………………. 24,000Notes Payable, due January 31, 2015 ………………… 60,000What amount should be included in the current liability section of Blues’ December 31, 2011, balance sheet?a. $135,000b. $153,000c. $195,000d. $234,0002. Information from Blain Company’s balance sheet is as follows:Current assets: Cash ……………………………………………. $ 1,200,000Investment securities …………………………….. 3,750,000Accounts receivable ………………………………. 28,800,000Inventories ……………………………………… 33,150,000Prepaid expenses …………………………………. 600,000Total current assets ……………………………… $67,500,000Current liabilities: Notes payable ……………………………………. $ 750,000Accounts payable …………………………………. 9,750,000Accrued expenses …………………………………. 6,250,000Income taxes payable ……………………………… 250,000Payments due within one year on long-term debt ………. 1,750,000Total current liabilities ……………………….. $18,750,000What is Blain’s quick (acid-test) ratio?a. 0.26 to 1b. 0.30 to 1c. 1.80 to 1d. 3.60 to 13. Information from Blain Company’s balance sheet is as follows: Current assets:Current assets: Cash ……………………………………………. $ 1,200,000Investment securities …………………………….. 3,750,000Accounts receivable ………………………………. 28,800,000Inventories ……………………………………… 33,150,000Prepaid expenses …………………………………. 600,000Total current assets ……………………………… $67,500,000Current liabilities: Notes payable ……………………………………. $ 750,000Accounts payable …………………………………. 9,750,000Accrued expenses …………………………………. 6,250,000Income taxes payable ……………………………… 250,000Payments due within one year on long-term debt ………. 1,750,000Total current liabilities …………………………. $18,750,000What is Blain’s current ratio?a. 0.26 to 1b. 0.30 to 1c. 1.80 to 1d. 3.60 to 14. Treasury stock should be reporteda. as a current asset only if it will be sold within the next year or the operating cycle, whichever is longer.b. as a current asset only if it will be sold within the next year or the operating cycle, whichever is shorter.c. in the Investments and Funds section of the balance sheet.d. as a deduction from total stockholders’ equity on the balance sheet.5. Account balances and supplemental information for the Bighorn Corporation as of December 31, 2012, are given below:Accounts Payable ………………………………… $ 75,900Accounts Receivable ……………………………… 141,600Accumulated Depreciation–Equipment ……………….. 84,000Bonds Payable …………………………………… 300,000Cash …………………………………………… 243,900Common Stock ……………………………………. 1,560,000Deferred Income Tax Liability (noncurrent) …………. 6,900Dividends Payable ……………………………….. 45,000Equipment ………………………………………. 840,000Income Taxes Payable …………………………….. 91,500Inventory ………………………………………. 395,100Investment in Land ………………………………. 510,000Investment in Stock of Subsidiary …………………. 492,000Note Payable ……………………………………. 120,000Notes Receivable ………………………………… 150,000Prepaid Insurance ……………………………….. 7,200Retained Earnings ……………………………….. 453,600Salaries and Wages Payable ……………………….. 42,900(a) $300,000 of 12% bonds were sold on November 1, 2012, at par.(b) 40,000 shares of $30 par value common stock were sold for $1,560,000.(c) All the equipment was purchased on January 2, 2011. The depreciation rate is 10 percent per year.(d) 5 percent of accounts receivable are expected to be uncollectible.(e) A two-year insurance policy was purchased on May 1, 2012, for $7,200.(f) Accrued interest on $150,000 of short-term notes receivable from customers was $5,100 at December 31, 2012.(g) $120,000 was borrowed from the bank on a 5-year, 10% note payable dated July 1, 2012. The loan is to be repaid in 10 semiannual payments of $12,000 plus interest, with the first payment due January 1, 2013.Prepare a properly classified balance sheet in report form for Bighorn Corporation as of December 31, 2012.