selected information taken from the december 31 2014 financial statements for mesa c 4374041

Selected information taken from the December 31, 2014, financial statements for Mesa Company is shown below for the year just ended:Current assets ……………………… $120,000Property, plant and equipment… 840,000Intangibles………………………….. 50,000Current liabilities………………….. 72,000Long-term liabilities ………………. $660,000Equity …………………………………. 278,000Revenues…………………………….. 960,000Expenses…………………………….. 890,000Mesa Company purchased $34,000 of merchandise inventory that was recorded as a debit to Merchandise Inventory and a credit to Accounts Payable on December 28; it was shipped FOB destination on December 28 and received on January 5. Because this liability was not due until 2015, it was listed as a long-term liability on the December 31, 2014, balance sheet. $50,000 of revenue earned but not recorded as of December 31, 2014, was recorded as a debit to Accounts Receivable and a credit to Revenue on December 31, 2014. $80,000 was collected on December 15 for services to be provided in February and March of 2015; this amount was recorded on December 15 as a debit to Cash and a credit to Revenue. $5,000 of interest accrued on a note payable during December and was recorded when it was paid on January 5, 2015, as a debit to Interest Expense and a credit to Interest Payable. $40,000 of payroll liabilities had accrued as of December 31, 2014, but had not been recorded. $430,000 of the long-term liabilities were due after December 31, 2015; the balance was current. Required Using the elements of critical thinking described on the inside front cover, comment.View Solution:
Selected information taken from the December 31 2014 financial statements

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