Introduction to Accounting

posted by .

The proprietors of two businesses, L.L. Sams Company and Melinda Garcia Career Services, have sought business loans from you. To decide whether to make the loans, you have requested their balance sheet to view.

L.L. Sams Company Balance Sheet August 31, 2004

Assets
Cash $9,000
Accounts Receivable 14,000
Merchandise Inventory 85,000
Store supplies 500
Building 80,000
Furniture and fixtures 9,000
Land 14,000
Total assets $211,500

Liabilities
Accounts Payable 12,000
Note Payable 18,000
Total Liabilities 30,000

Owner's Equity
L.L. Sams, capital 181,500
Total Liabilities And owner's equity $211,500

Melinda Garcia Career Services Balance Sheet August 31, 2004

Assets
Cash $11,000
Accounts Receivable 7,000
Office supplies 1,000
Office furniture 56,000
Land 169,000

Liabilities
Accounts Payable $6,000
Note Payable 168,000
Total Liabilities 174,000

Owner's Equity
Melinda Garcia, capital 70,000
Total liabilities And owner's equity $244,000
I would appreciate the positive response and answer. Please explain I would like to understand this question. Many Thanks!!


Accounting is not my area. But the answer to this problem is obvious. Melinda is already up to her eyeballs in debt; she already owes 168,000+6000 on a business with total assets of 244,000. Further, the 168K far exceeds Melinda's personally invested capital of 70,000. Compare this to Sam.

Respond to this Question

First Name
School Subject
Your Answer

Similar Questions

  1. Business Environment and Recording Transactions

    The proprietors of two businesses, L.L. Sams Company and Melinda Garcia Career Services, have sought business loans from you. To decide whether to make the loans, you have requested their balance sheets. Solely on the basis of these …
  2. econ 181

    What isthe max amount of new loans that this bank can make?
  3. accounting

    Ok, the case is this. Six months ago, you closed your business. Now, a person has expressed an interest in acquiring the business. The potential buyer requests a current balance sheet, but you provide her with the one that was prepared …
  4. introduction to accounting

    the proprietos of two businesses, L.L. sams company and Melinda Garcia career services, have sought loans form you. to decide whether to make the loans, you have requested thier balance sheets
  5. accounting

    Unit 1 Individual Project Deliverable Length: 2-3 paragraphs Details: The proprietors of two businesses, L.L. Sams Company and Melinda Garcia Career Services, have sought business loans from you. To decide whether to make the loans, …
  6. accounting

    Post a 200- to 300-word response to the following: You have been hired into a new company to oversee the accounting department. What type of financial reports would you expect to see in your department?
  7. MAth

    1. John’s loans for his business total $155,000. One of the loans is a SBA loan at 11% interest; the other loan is a Community Business Partner loan whose interest is 6.5% After one year the loans accumulated $12,325 in interest. …
  8. maths

    BEGGING FOR HELP!!! EXAM IN 20 MINS LOST ON HOW TO DO THIS Q. Company has $ 20 million dollars for two types insurance. Insurance A-homeowners have a 10% annual return. Insurance B-Auto has a 12% annual return. The total amount of …
  9. Civics

    Which of the following would contribute most to the creation of a strong economy?
  10. Civics

    Which of the following would contribute most to the creation of a strong economy?

More Similar Questions