E1-4 L01-1 Preparing a Balance Sheet Honda Motor Corporation of Japan is a

Question:
E1-4 L01-1 Preparing a Balance Sheet Honda Motor Corporation of Japan is a leading international
manufacturer of automobiles, motorcycles, all-terrain vehicles, and personal watercraft. As a Japanese
company, it follows Japanese GAAP and reports its financial statements in billions of yen. Its recent
balance sheet contained the following items in billions). Prepare a balance sheet as of March 31, current
year, solving for the missing amount. (Hint: Exhibit 1.2 in the chapter provides a good model for
completing this exercise.) Cash and cash equivalents ¥1,279 259 Common stock Accounts payable and
other current liabilities 3,568 900 Inventories Investments 640 2.043 Long-term debt Net property, plant,
and equipment 1.939 Other assets 6,025 1,377 Other liabilities Retained earnings 4.324 Total assets
11,571 Total liabilities and stockholders' equity Trade accounts, notes, and other receivables 788

Answer:

To prepare a balance sheet for Honda Motor Corporation of Japan, we need to organize the given
information into the following categories:

Assets:
 Cash and cash equivalents
 Accounts receivable
 Inventories
 Investments
 Property, plant, and equipment
 Other assets

Liabilities:
 Accounts payable
 Other current liabilities
 Long-term debt
 Other liabilities

Equity:
 Common stock
 Retained earnings

Total assets must equal the sum of total liabilities and equity

Honda Motor Corporation of Japan Balance Sheet As of March 31, current year (In billions of yen)