Assalamualaikum and salam 1 Malaysia
How's your work going? hopefully, everything is going to be fine la ye..for this semester, i consider it will be a challenging semester. Why? maybe because of the subjects. especially financial subjects..hahah....Very challenging but interesting. For this posting, I wanna....
share my answers to all of my mates..maybe we can share our analysis so that the answers will be more accurate and reasonable.
Here is my answers
How's your work going? hopefully, everything is going to be fine la ye..for this semester, i consider it will be a challenging semester. Why? maybe because of the subjects. especially financial subjects..hahah....Very challenging but interesting. For this posting, I wanna....
share my answers to all of my mates..maybe we can share our analysis so that the answers will be more accurate and reasonable.
Here is my answers
Required Indicate your criticisms of the balance sheet and briefly explain the proper treatment of any item criticized
Based on Balance sheet above, there are nine items that should be adjusted. The items are as follow
- The balance sheet heading is wrong .It is supposed to specify point in time. i.g Balance sheet as at 31 December 2012.
- The assets category is not shown at the balance sheet. The assets category should be stated separately to differentiate current assets and non-current assets. Land and building should be presented at non-current assets category
- . Investment in subsidiary company is misplaced at current assets. It is supposed to be presented at non-current assets (fixed assets) because it is long-term investment.
- Treasury Stock is not assets category. It is supposed to be deducted from shareholders’ equity
- Cash which is including $13,000 in sinking fund for bonds payable can be mixed together. $13,000 should be classified as restricted cash it is used by company to pay off the debt.What is Restricted Cash?
- . Discount on bonds Payable is not assets category. It should be subtracted from bond payable It and it will be added if it is premium on bond Payable.
- the liabilities category is not shown at the balance sheet. The liabilities category should be stated separately to differentiate current liabilities and Long-term liabilities
- Bonds Payable should be presented at non-current liabilities. Notes payable to bank and accounts payable are In current liabilities
- Preferred and common stocks should be stated separately in stockholders’ equity
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