As controller for Henderson, you are attempting to reconstruct and revise the following
balance sheet prepared by a staff accountant.
Henderson Manufacturing Company
Balance Sheet
At December
$ in s
Liabilities and Shareholders' Equity
Shareholders' equity:
Common stock
Retained earnings
Total liabilities and shareholders' equity
Additional information in s:
Certain records that included the account balances for the franchise and shareholders'
equity items were lost. However, a complete, preliminary balance sheet prepared before
the records were lost showed a debt to equity ratio of That is total liabilities are
of total shareholders' equity. Retained earnings at the beginning of the year was
$ Net income for was $ and $ in cash dividends were declared and
paid to shareholders.
The investments represent treasury bills purchased in December that mature in
January These are considered cash equivalents.
Interest on both the notes and the bonds is payable annually.
The notes payable account contains one note that is due in annual installments of $
for each payment due.
Deferred revenue will be recognized equally over the next months.
The common stock represents shares of no par stock authorized, of which
shares are issued and outstanding.
Required:
Prepare a complete, corrected, classified balance sheet.
