# Classified Balance sheet queston?

I’ve been having a hard time with this question. For total assets I got \$ 212,720 and \$ 206,700 for Total liabilities and stockholders’ equity. I’ve noticed that the only way to make them equal is by using the service revenue and expenses, which would give me an answer of 221,400. The problem is that I thought Service revenue wasn’t listed in the balance sheet and it should be stated in the income statement instead. Am I doing something wrong, or is the book just incorrect?

Here’s the question:

These items are taken from the financial statements of Victory Co. at December 31, 2012.
Buildings ……………………………….. \$ 105,800
Accounts receivable ………………………. 12,600
Prepaid insurance ……………………….….. 3,200
Cash ………………………………………. 11,840
Equipment ………………………………… 82,400
Land ………………………………………. 61,200
Insurance expense …………………………….. 780
Depreciation expense ……………………….. 5,300
Interest expense ………………………….…. 2,600
Common stock …………………………….. 60,000
Retained earnings (January 1, 2012) ………. 40,000
Accumulated depreciation—buildings ……. 45,600
Accounts payable …………………………… 9,500
Notes payable ……………………………… 93,600
Accumulated depreciation—equipment …… 18,720
Interest payable ……………………………… 3,600
Service revenue …………………………….. 14,700
Instructions
Prepare a classified balance sheet. Assume that \$ 13,600 of the note payable will be paid in 2013.

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#### One thought on “Classified Balance sheet queston?”

1. Sandy says:

You’ve already got the answer, in a way. The Retained earnings they gave you were at January 1, 2012. You need to arrive at the Retained earnings at December 31, 2012 before you can fit it into your balance sheet. So,

Net income:
Service revenue 14,700
less:
Insurance expense 780
Depreciation expense 5,300
Interest expense 2,600
= \$ 6,020

Retained earnings January 1, 2012 \$ 40,000
Net income 6,020
Retained earnings December 31, 2012 \$ 46,020

Can you get it now?