L04 EXERCISE 2.2 Preparing a Balance Sheet The night manager of Dixie Transportation Service, who had no accounting background, prepared the following balance sheet for the company at February 28, 2011. The dollar amounts were taken directly from the company's accounting records and are correct. However, the balance sheet con- tains a number of errors in its headings, format, and the classification of assets, liabilities, and owners' equity. DIXIE TRANSPORTATION SERVICE MANAGER'S REPORT 8 P.M. THURSDAY Assets Capital Stock Retained Earnings Cash.. Building Automobiles $ 92,000 62,000 69,000 80,000 165,000 $468,000 Owners' Equity Accounts Receivable Notes Payable Supplies Land Accounts Payable. $ 70,000 288,000 14,000 70,000 26,000 $468,000 L04 EXERCISE 2.3 Preparing a Balance Sheet Prepare a corrected balance sheet. Include a proper heading. The balance sheet items of Mercer Company as of December 31, 2011, follow in random order. You are to prepare a balance sheet for the company, using a similar sequence for assets as illus- trated in Exhibit 29. You must compute the amount for Retained Earnings. Land Accounts Payable. Accounts Receivable $90,000 43,800 56,700 36,300 Office Equipment Building. Capital Stock Notes Payable Retained Earnings $ 12,400 210,000 75,000 207,000 ? Cash...... L05 EXERCISE 2.13 Income Statement An inexperienced accountant for Yarnell Company prepared the following income statement for the month of August 2011: YARNELL COMPANY AUGUST 31, 2011 $15,000 5,000 15,000 $35,000 Revenues: Services provided to customers Investment by stockholders Loan from bank Expenses: Payments to long-term creditors.. Expenses required to provide services to customers Purchase of land. Net loss... $11,700 7,800 16,000 35,500 $ 500 Prepare a revised income statement in accordance with generally accepted accounting principles