The Monk Company Reports the Following Accounts and Balances on December

question 119

Essay

The Monk Company reports the following accounts and balances on December 31,2015.
$$\begin{array} { l l } \text { Accounts Payable } & \$ 14,400 \\\text { Accounts Receivable } & 8,000 \\\text { Cash } & 26,000 \\\text { Equipment } & 80,000 \\\text { Land } & 56,000 \\\text { Long-term Note Payable } & 70,000 \\\text { Merchandise Inventory } & 28,000 \\\text { Paid-in Capital } & ? \\\text { Retained Earnings } & 14,400\end{array}$$
Required:
Prepare a balance sheet at December 31,2015.

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Definitions:

Asset Turnover

A financial ratio that measures the efficiency of a company's use of its assets to generate sales or revenue.

Average Total Assets

This metric calculates the average value of all assets owned by a company over a specific period, usually used in financial analysis to gauge productivity.

Aging Method

An accounting technique used to estimate the amount of bad debts (uncollectible accounts) by categorizing accounts receivable according to their age (how long they have been outstanding).

Allowance Account

A contra asset account associated with accounts receivable that estimates the amount of receivables that may not be collected.