To find the long-term debt for Sharpshooter Productions, we need to ensure that the accounting equation holds true, which is:
\[ \text{Assets} = \text{Liabilities} + \text{Equity} \]
Step 1: Calculate Total Assets
Total Assets can be calculated by summing all asset accounts:
- Cash and marketable securities = $201,660.00
- Accounts Receivable = $291,865.00
- Inventory = $122,165.00
- Net Fixed Assets = $461,640.00
- Goodwill and other assets = $84,450.00
\[ \text{Total Assets} = 201,660 + 291,865 + 122,165 + 461,640 + 84,450 \]
\[ \text{Total Assets} = 1,162,780.00 \]
Step 2: Calculate Total Liabilities
Total liabilities consists of accounts payable, notes payable, and long-term debt:
- Accounts payable = $82,995.00
- Notes payables = $68,735.00
- Long-term debt = \(L\) (this is the unknown we need to find)
\[ \text{Total Liabilities} = 82,995 + 68,735 + L \]
\[ \text{Total Liabilities} = 151,730 + L \]
Step 3: Calculate Total Equity
Total equity can be calculated using common stock and retained earnings:
- Common stock = $100,000.00
- Retained Earnings = $526,140.00
\[ \text{Total Equity} = 100,000 + 526,140 \]
\[ \text{Total Equity} = 626,140.00 \]
Step 4: Set Up the Accounting Equation
Now we set up the equation based on what we have calculated:
\[ \text{Total Assets} = \text{Total Liabilities} + \text{Total Equity} \]
Substituting the values we have:
\[ 1,162,780 = (151,730 + L) + 626,140 \]
Step 5: Solve for Long-Term Debt (L)
\[ 1,162,780 = 151,730 + L + 626,140 \]
Combine the constants on the right side:
\[ 1,162,780 = 777,870 + L \]
Now isolate \(L\):
\[ L = 1,162,780 - 777,870 \]
\[ L = 384,910 \]
Conclusion
The long-term debt for Sharpshooter Productions is $384,910.00.
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