Sampson Company has $500 in its checking account. A customer owes Sampson $1,000. The company

Sampson Company has $500 in its checking account. A customer owes Sampson $1,000. The
company has store equipment that cost $1,500 and a truck that cost $5,000. Sampson Company
owes the bank $3,500 on the truck loan of which one payment of $700 is due in one week, and
owes $4,000 to creditors for its monthly operating expenses, including rent, all of which is due in
the next 30 days.

A.
B.
2.

List Sampson Company’s assets and the dollar amount of each.
List Sampson Company’s liabilities and the dollar amount of each.

The following are account balances of Marcia Company on 12/31/10.

Accounts payable
Accounts receivable
Buildings and equipment
Contributed capital
Bonds payable
Cash
Retained earnings
Accumulated depreciation
Inventory
Patents

$ 1,000
6,000
54,000
20,000
15,000
8,500
17,000
24,000
5,500
3,000

Prepare a classified balance sheet for Marcia Company on December 31, 2010.

3.
Retained earnings on January 1 was $27,000. During the current year net income is
$160,000. Cash payments for dividends declared totals $145,000. What is the retained earnings
balance on December 31?
4. Madison Company has current assets, current liabilities, and long-term liabilities of $8,000, $4,000,
and $6,000, respectively. Within these amounts, inventory was $2,000, receivables were $2,000, cash was
$4,000, and payables were $1,000. Calculate Madison’s quick ratio. What information does this provide?