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FINANCIAL STATEMENT PROJECT #5 Below is the trial balance of End Star Corporation on December 31, 2018. The accounts are listed in alphabetical order and all accounts have normal balances. Account Title: Balance: Account Title: Balance: Accounts Payable 1,100 Income Tax Payable 1,900 Accounts Receivable 3,600 Interest Expense 1,570 Accum. Amort. – Copyright 400 Interest Payable 254 Accum. Amort. – Patent 200 Interest Receivable 20 Accum. Depl. – Gold Mine 800 Interest Revenue 75 Accum. Depr. – Bldngs. 3,000 Land 3,600 Accum. Depr. – Equip. 2,200 Long-Term Investment in Bonds 5,600 Adjustment to Market on Mareketable Securities (debit balance) 350 Long-Term Investment in Subsidiary 27,600 Administrative Expenses 5,320 Loss on Sale of AFS Sec. 445 Allowance for Bad Debts 500 Marketable Securities (held as available for sale securities) 4,400 APIC-Common 2,200 Merchandise Inventory 2,800 APIC-Preferred 800 Mortgage Note Payable (30-year) 16,000 APIC-Treasury 900 Notes Receivable (short-term) 700 Bonds Payable (15 year) 16,500 Patent 950 Buildings 12,000 Preferred Stock 4,000 Cash 5,980 Prepaid Insurance 1,100 Cash Dividends Declared 2,400 Rental Revenue 250 Common Stock 8,000 Retained Earnings 18,290 Common Stock Dividend Distributable 1,200 Salaries Payable 1,300 Copyright 600 Sales 44,200 Cost of Goods Sold 22,869 Sales Discounts 740 Discount on Bonds Payable 1,400 Sales Returns & Allowances 1,880 Dividend Revenue 80 Selling Expenses 6,670 Dividends Payable 1,300 Short-Term Notes Payable 1,400 Equipment 7,400 Stock Dividends Declared 1,800 FICA Taxes Payable 800 Subsidiary Income 2,120 FIT Payable 1,600 Supplies 800 FUTA Taxes Payable 100 SUTA Taxes Payable 400 Gain on Disposal of Plant Assets 25 Treasury Stock 1,750 Gold Mine 5,500 Unealized Gain on Valuation of Marketable Securities 350 Income Tax Expense 3,200 Unearned Rental Revenue 800 REQUIRED: Prepare the financial statements for the year for End Star Corporation–a multi-step income statement, a statement of retained earnings and a classified balance sheet. What is different for this project compared to Project #4? 1. New Accounts: Chapter 10: Bonds Payable is a long-term liability account Premium on Bonds Payable and Discount on Bonds Payable are an adjunct and contra account TO the Bonds Payable account Mortgages Payable is a long-term liability account Chapter 12: Marketable Securities is a current asset. Adjustment to Market accounts are either an adjunct (debit balance) OR a contra (credit balance) to the Marketable Securities account. Losses and Gains on Sales of investment assets are realized gains and losses on the income statement Unrealized Losses and Gains on investment assets are on the income statement if the investments are trading securities and are on the stockholders’ equity section of the balance sheet if the investments are available for sale securities (as either a contra or adjunct account to the total of paid in capital and retained earnings) Long-Term Investments in Bonds are long-term investments Long-Term Investments in Subsidiary Company (under the equity method) are long-term investments Subsidiary Income (our share of subsidiary net income under the equity method) is on the income statement Dividend Revenue is on the income statement 2. Classified Balance Sheet: We will now have FOUR asset categories: current, plant, intangible, and long-term investments