Dave is the president of Avon Consulting Inc. Avon began business on January 1, 2010. The company's controller is out of the country on business. Dave needs a copy of the company's balance sheet for a meeting tomorrow and asks his assistant to obtain the required information from the company's records. She presents Dave with the following balance sheet. He asks you to review it for accuracy.

Required
1. Prepare a corrected balance sheet.
2. Draft a memo explaining the major differences between the balance sheet Dave's assistant prepared and the one youprepared.

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Avon Consulting Inc. Balance Sheet For the Year Ended December 31, 2010 Assets Liabilities and Stockholders quity Accounts payable Cash Cash dividends paid Furniture and equipment $13,000 21,000 16,000 43,000 Accounts receivable Capital stock Net income for 2010 Supplies $16,000 20,000 72,000 9,000