The following balance sheet for the Los Gatos Corporation wa

The following balance sheet for the Los Gatos Corporation was prepared by a recently hired accountant. In reviewing the statement you notice several errors LOS GATOS CORPORATION Balance Sheet December 31, 2018 Assets $ 48,000 92,000 59,000 124,000 34,000 $357,000 Cash Accounts receivable Inventories Machinery (net) Patent (net) Total assets Liabilities and Shareholders\' Equity Accounts payable Allowance for uncollectible accounts Note payable Bonds payable Shareholders\' equity5,6 58,000 9,000 63,000 114,000 113,000 $357,000 Total liabilities and shareholders\' equity Additional information: 1. Cash includes a $24,000 restricted amount to be used for repayment of the bonds payable due in 2022. 2. Accounts receivable includes a $24,000 note receivable from a customer due in 2021 3. The cost of the machinery is $198,000 4. The note payable includes accrued interest of $9,000. Principal and interest are both due on February 1, 2019 5. The company began operations in 2013. Income less dividends since inception of the company totals $39,000. 6. 54,000 shares of no par common stock were issued in 2013. 100,000 shares are authorized Required Prepare a corrected, classified balance sheet. (Amounts to be deducted should be indicated by a minus sign.) LOS GATOS CORPORATION Balance Sheet

Solution

LOS GATOS CORPORATION Balance Sheet December 31, 2018 Assets Current assets Cash 24000 Accounts receivable 68000 Allowance for uncollectible accounts -9000 59000 Inventories 59000 Total current assets 142000 Property, Plant, and Machinery Machinery 198000 Accumulated depreciation -74000 124000 Intangible assets Patent (net) 34000 Other assets Restricted cash 24000 Note receivable 24000 Total other assets 48000 Total assets $ 348000 Liabilities and Shareholders\' Equity Liabilities Current liabilities Accounts payable 58000 Note payable 54000 Interest payable 9000 Total current liabilities 121000 Long-term liabilities Bonds payable 114000 Total liabilities 235000 Shareholders\' Equity Common stock 74000 Retained earnings 39000 Total shareholders\' equity 113000 Total liabilities and shareholders\' equity $ 348000