Cone corporation is in the process of preparing its december 31, 2016, balance sheet. there are some questions as to the proper classification of the following items1. $62,000 in cash restricted in a savings account to pay bonds payable. the bonds mature in 20202. prepaid rent of $36,000, covering the period january 1, 2017, through december 31, 20183. note payable of $224,000. the note is payable in annual installments of $32,000 each, with the first installment payable on march 1, 20174. accrued interest payable of $24,000 related to the note payable5. investment in marketable securities of other corporations, $104,000. cone intends to sell one-half of the securities in 2017required: prepare a partial classified balance sheet to show how each of the above items should be reported

Account of Current Assets , the criteria is to have a liquidity speed less of one year

Cash

Prepaid Rent - Half of the prepaid rent it's on Non-Current Assets because it cover part of year 2018.

Investment in Equity Sec - Half of the Investment it's on Current Assets because part will be sell on 2017.  

Account of Non Current Assets , the criteria is to have a liquidity speed more than one year and are known as fixed assets

Investment in Equity Sec

Prepaid Rent

Account of Current Liabilities , the criteria is to have a liquidity speed less of one year

Interest Payable - Accrued interest to be paid corresponds to the note payable.  

Note Payable - Correspond to the installments to be paid on March 2017.  

Account of Non-Current Liabilities , the criteria is to have a liquidity speed more than of one year

Note Payable - The note payable with mature more than one year.  

Bond Payable - Bonds to mature in 2020 with the reserve on cash.  

Explanation:

2016Balance Sheet

$62,000  Cash

$18,000  Prepaid Rent

$52,000  Investment in Equity Sec

$132,000  TOTAL CURRENT ASSETS  

$52,000  Investment in Equity Sec

$18,000  Prepaid Rent

$70,000   TOTAL NONCURRENT ASSETS  

$202,000  TOTAL ASSETS  

$24,000   Interest Payable  

$32,000   Note Payable  

$56,000   TOTAL CURRENT LIABILITIES  

$192,000  Note Payable  

$62,000   Bond Payable  

$254,000  TOTAL NONCURRENT LIABILITIES  

$310,000  TOTAL LIABILITIES  

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you get one warning and if you do something to violate the guidelines of after that you get kicked off.

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