The manager of Upod, Inc., prepared the balance sheet of the company while the accountant was ill. The balance sheet contains numerous errors. In particular, the manager knew that the balance sheet should balance so he plugged in the stockholders' equity amount needed to achieve this balance. The stockholders' equity amount, however, is not correct. All other amounts are accurate.

Required
1. Prepare the correct balance sheet and date it properly. Compute total assets, total liabilities, and stockholders' equity.
2. Is Upod, Inc., actually in better (or worse) financial position than the erroneous balance sheet reports? Give the reason for your answer. (Challenge)
3. Identify the preceding accounts that should not be reported on the balance sheet. State why you excluded them from the correct balance sheet you prepared for Requirement 1. Which financial statement should these accounts appear on?

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UPod, Inc. Balance Sheet Month Ended July 31,20X7 Assets Liabilities Accounts payabl.$12,000 50,000 800 5,000 67,800 Cash Office furniture $11,000 10,000 Note payable...16,000 4,000 1,000 44,000 2,500 Service revenue Property tax expense... Accounts payabl. Total Rent expense Office suu Stockholders' Equity Advertising expense equity..20.700