$70$

Chapter $2$ Basic Financial Statements

LO$2-4$

EXERCISE $2\mathrm{.}2$

Preparing a Balance Sheet

The night manager of Willis Transportation Service, who had no accounting background, prepared the following balance sheet for the company at February $28,$ current year. The dollar amounts were taken directly from the company's accounting records and are correct. However, the balance sheet contains a number of errors in its headings, format, and the classification of assets, liabilities, and owners' equity.

$\backslash$table$[[\backslash$table$[[$WILLIS TRANSPORTATION SERVICE$],[$MANAGER$\text{'}$S REPORT$],[8$ P$.$M$.$ THURSDAY$]]],[$Assets$,,$Owners' Equity,$],[$Capital Stock,$ $110,400,$Accounts Receivable,$ $84,000],[$Retained Earnings,$74,400,$Notes Payable $....,345,600],[$Cash$,94,800,$Supplies,$16,800],[$Building$,96,000,$Land,$84,000],[$Automobiles$,198,000,$Accounts Payable $.,43,200],[,$$$573,600,,$$$573,600]]$

Prepare a corrected balance sheet. Include a proper heading.