Assets Current assets: Cash Accounts payable Supplies Prepaid insurance Land Total current assets Property. plant, Building...

Transcribed Image Text:

Assets Current assets: Cash Accounts payable Supplies Prepaid insurance Land Total current assets Property. plant, Building Equipment equipment: Total property, plant, Total assets Billy Brown Services Co. Balance Sheet For the Year Ended December 31, 2021 and and equipment $6.170 8,500 1,590 345 25.000 $45,500 28,250 Liabilities Current liabilities: Accounts receivable Accum. depr-building Accum, depr-equipment Net income $41.605 Total liabilities 73.750 Owner's Equity Wages payable Billy Brown, capital Total owner's equity Total liabilities and $116,355 owner's equity S 9,000 13,525 6,340 12,500 $41,365 $ 500 74,490 $74,990 $116,355 Required a. List the errors in the balance sheet above. b. Prepare a corrected balance sheet. c. Compared with the cash basis, what are the advantages and the disadvantages of the accrual basis. Assets Current assets: Cash Accounts payable Supplies Prepaid insurance Land Total current assets Property. plant, Building Equipment equipment: Total property, plant, Total assets Billy Brown Services Co. Balance Sheet For the Year Ended December 31, 2021 and and equipment $6.170 8,500 1,590 345 25.000 $45,500 28,250 Liabilities Current liabilities: Accounts receivable Accum. depr-building Accum, depr-equipment Net income $41.605 Total liabilities 73.750 Owner's Equity Wages payable Billy Brown, capital Total owner's equity Total liabilities and $116,355 owner's equity S 9,000 13,525 6,340 12,500 $41,365 $ 500 74,490 $74,990 $116,355 Required a. List the errors in the balance sheet above. b. Prepare a corrected balance sheet. c. Compared with the cash basis, what are the advantages and the disadvantages of the accrual basis.