Listed below random order are the items to be included in the balance sheet of Smokey Mountain Lodge at December 31,2009:

Equipment . . . . . . . . . . . . . . . . . . . . . . . . $ 39,000 Buildings . . . . . . . . . . . . . . . . . . . . . . . . . . $ 450,000

Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 425,000 Capital Stock . . . . . . . . . . . . . . . . . . . . . . . . 135,000

Account Payable . . . . . . . . . . . . . . . . . . . . 54,800 Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31,400

Account Receivable . . . . . . . . . . . . . . . . . . 10,600 Furnishings . . . . . . . . . . . . . . . . . . . . . . . . . . 58,700

Salaries Payable . . . . . . . . . . . . . . . . . . . . . 33,500 Snowmobiles . . . . . . . . . . . . . . . . . . . . . . . . .15,400

Interest Payable . . . . . . . . . . . . . . . . . . . . . 12,000 Notes Payable . . . . . . . . . . . . . . . . . . . . . . . 620,000

Retained Earnings . . . . . . . . . . . . . . . . . . . . ?

Instructions

a. Prepare a balance sheet at December 31,2009. Include a proper heading and organize your balance sheet similar to exhibit 2-9. ( After " Buildings," you may list the remaining assets in any order). You will need to compute the amount to be show for Retained Earnings.

b. Assume that no payment is due on the notes payable until 2011. Does this balance sheet indicate that the company is in a strong financial position as of December 31, 2009? Explain brirefly.