1.

4: Exercises
Exercise 1.1

The balance sheet of amusement park De Slootse Heuvels is presented below:

Debit Balance sheet of De Slootse Heuvels Ltd. per 31 December 2011 (in ) Credit

Buildings 14,350,000 Equity 29,195,000

Attractions 26,240,000 4% Mortgage 13,000,000
Equipment 8,900,000 4% Bank loan 9,110,000
Inventories 1,750,000 Accounts payable 170,000
Accounts receivable 185,000
Bank 50,000
51,475,000 51,475,000

Calculate the amount for the account Equity.

51,475,000 ( 13,000,000 + 9,110,000 + 170,000) = 29,195,000

Exercise 1.2.

One year later De Slootse Heuvels gathered the following information, needed to draw
up the balance sheet per 31 December 2012:

Because of aging (loss of value, or in other words depreciation) the value of the buildings
dropped to 13,800,000. Because of the same reason the value of the attractions
decreased to 25,700,000.

The depreciation on the equipment was 900,000. The value of the inventories is
1,875,000 and our accounts receivable still owe us 225,000. The company has
35,000 in its bank account.

On each of the loans 200,000 has been paid back. The last information provided is that
185,000 needs to be paid to accounts payable

a. Prepare the balance sheet per 31 December 2012.

Debit Balans van De Slootse Heuvels B.V. per 31 December 2012 (in ) Credit

Buildings 13,800,000 Equity 27,740,000

Attractions 25,700,000 4% Mortgage 12,800,000
Equipment 8,000,000 4% Bank loan 8,910,000
Inventories 1,875,000 Accounts payable 185,000
Accounts receivable 225,000
Bank 35,000
49,635,000 49,635,000

b. Show your calculation of the new Equity amount

49.635.000 ( 12.800.000 + 8.910.000 + 185.000) =
27.740.000

c. Equity changed. Can you identify possible causes?

For sure the company has changes in assets and liabilities. We can be sure of the
amounts for depreciation:
On buildings: 14,350,000 - 13,800,000 = 550,000
On attractions: 26,240,000 - 25,700,000 = 540,000
On equipment: 900,000
Total depreciation: 1,990,000
Furthermore it is obvious that there has also been interest, but we cannot
establish the exact amount (why not?).
Equity went down with: 29,195,000 - 27,740,000 = 1,455,000. Since
this is less than the depreciation it is clear that the company made a profit.
Exercise 1.3

Lets take it a step further: you now have to establish yourself on which side of the
balance sheet of Getaway ltd. the provided information has to appear:

Equipment 45,600
Accounts payable 5,500
Accounts receivable 2,600
Bank 1,900
Bank loan 10,000

The question is: compose the balance sheet!

Debit Balance sheet of Getaway Ltd. per 31 December 2013 Credit

Equipment 45,600 Equity 34,600

Accounts receivable 2,600 Bank loan 10,000
Bank 1,900 Accounts payable 5,500
50,100 50,100

Equity is calculated as: 50,100 ( 10,000 + 5,500)= 34,600

Exercise 1.4

The new Frisian Museum opened its doors in 2013. In the same building a grand caf
(Thus Ltd.) can be found. This exercise focuses on the caf for which the following
information at the end of 2013 is available:

Accounts receivable 9,000

Bank 7,000
Terrace furniture 9,900
Accounts payable 8,000
75 bottles of ros 450
Loan 10,000
Pallet red wine 1,200
VAT (1) payable 1,120
Flat screen TV, 1,100
Pallet white wine 1,350

(1) VAT: short for : Value Added Tax. This topic is explained in more detail in chapter
In this context you should focus on the word payable rather than on VAT!

Compose the balance sheet per 31 December 2013. Use terms you already know as
much as possible. You may have to merge certain items!
Debit Balans Ths B.V. per 31 December 2013 Credit

Equipment 11,000 Equity 10,880

Accounts receivable 9,000 Loan 10,000
Inventories 3,000 Accounts payable 8,000
Bank 7,000 VAT payable 1,120
30,000 30,000