Southampton Company’s balance sheet at November 29, 20X1, contained only the following items (arranged here in random order)

Southampton Company’s balance sheet at November 29, 20X1, contained only the following items (arranged here in random order):

.:.

On the following day, November 30, these transactions and events occurred:

1. Purchased machinery and equipment for £13,000, paying £4,000 in cash and signing a 90-day note for the balance

2. Paid £7,000 on accounts payable

3. Sold some land that was not needed for cash of £6,000, which was the Southampton

Company’s acquisition cost of the land

4. The remaining land was valued at £240,000 by professional appraisers

5. Issued capital stock as payment for £23,000 of the long-term debt, that is, debt due beyond 1 year

Prepare in good form a balance sheet for November 30, 20X1, showing supporting computations for all new amounts.

SOLUTION:

SOUTHAMPTON COMPANY

Balance Sheet

November 30, 20X1

Liabilities and