Identifying and Correcting Errors in a Balance Sheet Ceramics, Inc. reported the following balance sheet for the year 2004.
|
Balance Sheet |
|
|
Assets: |
|
|
Cash |
$2,000 |
|
Accounts payable |
500 |
|
Inventory |
900 |
|
Equipment |
1,000 |
|
Land |
1,500 |
|
Total assets |
$6,000 |
|
Liabilities: |
|
|
Accounts receivable |
$3,000 |
|
Accrued liabilities |
1,000 |
|
Total liabilities |
4,000 |
|
Stockholders” equity: |
|
|
Common stock |
1,800 |
|
Retained earnings |
5,100 |
|
Total stockholders” equity |
6,900 |
|
Total liabilities and stockholders” equity |
$10,900 |
Required
A. Identify and list the errors in the balance sheet above.
B. Prepare a corrected balance sheet.