Solve for missing amounts: Liabilities, Equity = 1.2 $18,000, Equity = 1.2 Equity = $18,000, 1.2 = $15,000 Beginning retained earnings + net income - dividends $4,000 + 1,560 560 Total equity - retained earnings = Common stock $15,000 - 5,000 = $10,000 Assets = Liabilities + equity Assets = $18,000 +15,000 = $33,000 $33,000 - all other assets = Patent $33,000 27,600 = $5,400 = Ending retained earnings $5,000 Sanderson Manufacturing Company Balance Sheet At December 31, 2011 (S in 000s, except share data) Current assets: Cash Short-term investments Accounts receivable, net of $400 allowance for uncollectible accounts Inventories: Raw materials and work in process Finished goods Prepaid expenses Total current assets Property, plant, and equipment: Equipment Less: Accumulated depreciation Assets Net property, plant, and equipment Intangible assets: Patent Total assets $2,250 15,000 $ 1,250 (4,200) 3,000 3,100 6,000 8,250 1,200 16,800 10,800 5,400 $33,000 Liabilities and Shareholders' Equity Current liabilities: Accounts payable Interest payable Unearned revenue Current maturities of long-term debt Total current liabilities Long-term liabilities: Unearned revenue Note payable Bonds payable Shareholders' equity: Common stock, no par, 400,000 shares authorized, 250,000 shares issued and outstanding Retained earnings Total shareholders' equity Total liabilities and shareholders' equity 1,500 3,000 5,500 10,000 5,000 $ 5,200 300 1,500 1,000 8,000 10,000 15,000 $33,000