Optimum Weight Loss Co. offers personal reduction consulting services to individuals.
After all the accounts have been closed on November 30, 2016 the end of the fiscal year, the balance of selected accounts from the ledger of Optimum Weight Loss Co. are as following:
Account payable 37,000
Account receivable 116,750
Accumulated depreciation equipment 186,400
Cash ?
Common stock 75,000
Equipment 474,500
Land 300,000
Prepaid insurance 7,200
Prepaid rent 21,000
Retained earning 635,300
Salaries payable 9,000
Supplies 4,8000
Unearned fees 18,000
Required:
1. Prepare a classified balance sheet that includes the correct balance for Cash.

Cash = (6750) negative cash

Explanation:

ASSETS:

Current assets:

Cash   (w#1)                              =  6750

Account receivable                  =  116750

Prepaid insurance                    =   7200

Prepaid rent                              =   21000

Supplies                                    =  48000

current assets                             (a) 186200

Fixed assets:

Equipment (474500-186400)   = 288100

Land                                           = 300000

Fixed assets                              588100(b)

Total Assets (a+b)                     =  774300

Liabilities:

Account payable                        = 37000

Salaries payable                         = 9000

Unearned fees                           =18000

  Total liabilities                            64000 (c)

Stockholders Equity:  

Common Stock                        = 75000

Retained earning                     = 635300

   Equity                                       710300(d)

Total liabilities & equity (c+d)    = 774300

(w#1) As we know that Assets = liabilities + equity  

cash+a/c receivable + prepaid insurance + prepaid rent + supplies+Equipment+land = 64000+710300

Cash + 116750+7200+21000+48000+288100+300000   = 774300

   Cash +781050 = 774300

    Cash = 774300-781050 = 6750    

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