Preparing Financial Statements

For your information . . .
Two examples of classified financial statements are presented here for you to examine.

Classified Financial Statements:

REPORT FORM of Balance Sheet:

The Toronto Hotel
Balance Sheet
October 31, 1997

Assets
Current Assets
Cash $9 300
Accounts Receivable 2 000
Supplies 6 000
Total Current Assets $17,300
Fixed Assets
Land 50 000
Building 500 000
Room Furniture 110 000
Office Equipment 5 000
Total Fixed Assets 665 000
Total Assets $682 300
Liabilities and Owner’s Equity
Current Liabilities
Accounts Payable $24 000
Long-Term Liabilities
Bank Loan $15 000
Mortgage Payable 100 000
Total Long-Term Liabilities 115 000
Total Liabilities 139 000
Owner’s Equity
Smith, Capital Oct. 1 536 000
Add: Net Income for October $8 200
Less: Smith, Drawings 900
Increase in Capital 7 300
Smith, Capital Oct. 31 543 300
Total Liabilities and Owner’s Equity $682 300

ACCOUNT FORM of Balance Sheet:

The Toronto Hotel
Balance Sheet
October 31, 1997

Assets Liabilities
Cash $9 300 Accounts Payable $24 000
Accounts Receivable 2 000 Bank Loan 15 000
Supplies 6 000 Mortgage Payable 100 000
Land 50 000 Total Liabilities 139 000
Building 500 000
Room Furniture 110 000 Owner’s Equity
Office Equipment 5 000 Smith, Capital, Oct. 1 $536 000
Add: Net Income for Oct. $8 200
Less: Smith, Drawings 900
Increase in Capital 7 300
Smith, Capital, Oct. 31 543 300
Total Assets $682 300 Total Liabilities
and Owner’s Equity
$682 300
BALANCE SHEET ACCOUNT CATEGORIES:
Current Assets Fixed Assets Current Liabilities Long-Term Liabilities
Cash Land Accounts Payable Bank Loan
Government Bonds Building Taxes Payable Mortgage Payable
Marketable Securities Furniture Furniture Salaries Payable
Accounts Receivable Equipment Short-term Loans
Supplies Trucks

Adapted from: Meigs, W.B., R.F. Heigs, and W.P. Lam. Accounting: The Basis
for Business Decisions. Toronto: John Deyell Co., 1985; and D’Amico, V., and
J. Magnan. Accounting – An Introduction. Mississauga: Copp Clark-Pitman Ltd.,
1991.