Ned Robinson, the manager of Lunenberg Times Inc., prepared the balance sheet of the company while the accountant was ill. The balance sheet contains numerous errors. In particular, the manager knew that the balance sheet should balance, so he plugged in the shareholders' equity amount needed to achieve this balance. The shareholders' equity amount, however, is not correct. All other amounts are accurate.

Requirements
1. Prepare the correct balance sheet, and date it properly. Compute total assets, total liabilities, and shareholders' equity.
2. Is Lunenberg Times Inc. actually in better or worse financial position than the erroneous balance sheet reports? Give the reason for your answer.
3. Identify the accounts listed in the incorrect balance sheet that are not reported on the corrected balance sheet. State why you excluded them from the correct balance sheet you prepared for Requirement 1. Which financial statement should these accounts appear on?

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Lunenberg Times Inc. Balance Sheet For the Month Ended October 31, 2017 Liabilities 2 3 Cash 4 Office furniture 5 Note payable 6 Rent expense 7 Inventory 8 Land Assets $ 25,000 Accounts receivable 10,000 70,000 20,000 8,000 15,000Sales revenue 16,000 Sala ense 4,000 Accounts payable 30,000 34,000 Shareholders' Equity 9 Advertising expense 10 Total assets 2,500 Shareholders' equity 18,500 126,500 $ 126.000 Total liabilities