Final answer:
The balance sheet for XYZ company as of December 2022 lists total assets of $560,900, total liabilities of $117,000, and a net worth (equity) of $443,900. The balance sheet equation Assets = Liabilities + Equity is therefore satisfied.
Step-by-step explanation:
To prepare a balance sheet as of December 2022 for XYZ Company, we must list the assets, liabilities, and then determine the company's equity. We start by adding up all the assets:
- Cash: $330,300
- Inventory: $72,000
- Supplies: $7,000
- Pre Paid Insurance: $5,600
- Building: $100,000
- Office Equipment: $45,000
The total assets of the company are calculated as:
Total Assets = Cash + Inventory + Supplies + Pre Paid Insurance + Building + Office Equipment
Total Assets = $330,300 + $72,000 + $7,000 + $5,600 + $100,000 + $45,000 = $560,900
Next, we calculate the total liabilities:
- Accounts Payable: $54,000
- Notes Payable: $28,000
- Mortgage Payable: $35,000
Total Liabilities = Accounts Payable + Notes Payable + Mortgage Payable
Total Liabilities = $54,000 + $28,000 + $35,000 = $117,000
Now, to find the net worth or equity of the company, we can subtract total liabilities from total assets:
Net Worth (Equity) = Total Assets - Total Liabilities
Net Worth (Equity) = $560,900 - $117,000 = $443,900
The balance sheet would therefore be presented with total assets of $560,900, total liabilities of $117,000, and equity of $443,900, ensuring that the equation Assets = Liabilities + Equity holds true.