Balance Sheet Component Matching Solution

Table of Contents
BS Component Matching Solution

Notes
This Excel model is for educational purposes only and should not be used for any other reason.
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Balance Sheet Component Matching Solution
A company has the following balance sheet accounts:

Account Description
Accounts receivable Customers who have purchased on credit – accoun
Income taxes payable Corporate taxes for the period that must be remitte
Long-term debt Borrowing for business – one or multiple loans whe
Contingencies A potential future liability that the company can rea
Property, plant & equipment Physical assets used to generate income over a per
Inventory Goods either purchased or produced for sale to cus
Current portion of capital lease obligation The amount owing over the next 12 months for cap
Cash and equivalents Cash or items that act like cash (eg, short term mon
Common shares/stock Shares held by investors in the company. These sh
Current portion of long-term debt The amount of any loan(s) repayments due within t
Goodwill The premium paid on the acquisition of another bu
Deferred income tax assets (expected to reverse in 12 months) A timing difference due to the difference between a
Unearned revenue Revenues that have been collected from customers
Accounts payable Supplier invoices that relate to the current reportin
Retained earnings The accumulated profits and losses of the business
Intangible assets Long term assets of the business that have no phys
Capital lease obligation Capital leases are leases that are related to specific
Accrued liabilities Liabilities that are related to the current reporting p
Prepaid expenses Expenses that have been incurred where the servic
Preferred shares/stock Shares purchased by investors that have fixed divid

Requirements:

Part I. Provide a brief description of what each account contains.

Part II. Using the attached template, place the accounts in the appropriate place on the balance sheet.

Balance Sheet
Assets Liabilities
Current assets: Current liabilities:
Cash and equivalents Accounts payable
Accounts receivable Accrued liabilities
Inventory Unearned revenue
Prepaid expenses Income taxes payable
Deferred income tax asset Current portion of long-term debt
Total current assets Current portion of capital lease obligation
Total current liabilities
Non-current assets:
Property, plant & equipment
Goodwill
Intangible assets
Total non-current assets
Total assets
Non-current liabilities:
Long term debt
Capital lease obligation
Contingencies
Total non-current liabilities
Shareholders' equity
Common stock
Preferred stock
Retained earnings
Total liabilities and shareholders' equity
urchased on credit – accounts to be collected.
period that must be remitted to government.
– one or multiple loans where term is longer than 12 months.
ty that the company can reasonably estimate (eg, from a pending lawsuit)
generate income over a period of time greater than 12 months. Include things such as buildings, furniture, computers, vehicles, man
d or produced for sale to customers.
r the next 12 months for capital lease payments.
ike cash (eg, short term money market funds) that a business holds.
s in the company. These shares allow for voting rights and participation in profits.
n(s) repayments due within the next 12 month period.
he acquisition of another business.
to the difference between accounting income and taxable income. Difference will reverse in the next reporting period.
en collected from customers but have not yet been earned by the company (eg, performance of service has not yet occurred, or prod
elate to the current reporting period but that have not yet been paid.
s and losses of the business since inception. If the company has more losses than profit, then this would be stated as “retained defic
e business that have no physical substance. Examples include licences, patents and trademarks.
s that are related to specific assets. They act the same as a loan – except instead of borrowing money to purchase the item outright, t
ed to the current reporting period but have not been paid. Typical accrued liabilities include compensation, audit and legal fees.
en incurred where the service has not as yet been “earned”/delivered. Typical prepaid expenses include insurance, rent and utilities.
vestors that have fixed dividends that have a priority over common shareholders.

n the balance sheet.

tal lease obligation

hareholders' equity
omputers, vehicles, manufacturing equipment.

ot yet occurred, or product has not yet been delivered).

tated as “retained deficit”.

hase the item outright, the company leases the asset – but all the benefits of ownership are substantially transferred through the leas
udit and legal fees.
ance, rent and utilities.
sferred through the lease.