Final answer:
Brick Master's balance sheet lists total assets of $37,200, liabilities of $31,050, and shareholders' equity of $6,150. The balance sheet is balanced, as the total liabilities and shareholders' equity equals the total assets.
Step-by-step explanation:
Preparing Brick Master's Balance Sheet:
To prepare the balance sheet for Brick Master as of September 30, we need to list the company's assets, liabilities, and shareholders' equity based on the given information. The balance sheet should be organized into these three main sections.
Assets:
- Machinery: $15,700 less Accumulated Depreciation: $1,600 gives Net Machinery: $14,100
- Prepaid Rent: $1,200
- Building: $16,500 (assuming no depreciation since it was bought on September 30)
- Cash: $2,250
- Accounts Receivable: $3,150
Total Assets = Net Machinery + Prepaid Rent + Building + Cash + Accounts Receivable = $14,100 + $1,200 + $16,500 + $2,250 + $3,150 = $37,200
Liabilities and Shareholders' Equity:
- Notes Payable (total): $22,700 (Current portion: $3,200)
- Accounts Payable: $6,600
- Taxes Payable: $1,750
Total Liabilities = Notes Payable + Accounts Payable + Taxes Payable = $22,700 + $6,600 + $1,750 = $31,050
- Common Stock: $2,250
- Retained Earnings: $3,900
Total Shareholders' Equity = Common Stock + Retained Earnings = $2,250 + $3,900 = $6,150
The total of liabilities and shareholders' equity should match the total assets to show that the balance sheet is balanced. Therefore, Total Liabilities and Shareholders' Equity = $31,050 + $6,150 = $37,200, which matches the total assets.