Final answer:
To find the Cash value, calculate the total liabilities and shareholders' equity and then subtract the sum of known assets. The total liabilities and shareholders' equity equals $1,360,000, and the total known assets equal $1,010,000. The difference, which is the Cash value, is $350,000.
Step-by-step explanation:
To determine the value of Cash on the Balance Sheet for Consolidated Industrial, we need to apply the accounting equation: Assets = Liabilities + Shareholders' Equity. The Assets include property, plant, and equipment; inventory; accounts receivable; and cash. The Liabilities include bonds; unearned revenue; accounts payable; and notes payable. Shareholders' Equity includes common stock and retained earnings.
The sum of all liabilities and shareholders' equity is:
- Bonds: $280,000
- Unearned Revenue: $160,000
- Accounts Payable: $80,000
- Notes Payable: $60,000
- Common Stock: $320,000
- Retained Earnings: $460,000
Adding these together gives us $1,360,000. The sum of known assets is:
- Property, Plant, and Equipment: $920,000
- Inventory: $50,000
- Accounts Receivable: $40,000
These amount to $1,010,000. Therefore, to balance the sheet, the Cash value must be Assets ($1,010,000) subtracted from the sum of Liabilities and Shareholders' Equity ($1,360,000), which equals $350,000.