10. The company was authorized to issue 100,000 shares of $50 par value common stock.
11. A review of accounts payable indicates that the company has experienced foreign currency translation losses of $3,000 as of December 31, 2014. The company bookkeeper was unaware of any accounting requirements in this area.
12. The goodwill was related to the purchase of an online shopping subsidiary in 2011. A review of the subsidiary’s operations indicates that it is near bankruptcy, indicating that the goodwill is 100% impaired.
13. A review of inventory, for which the company uses the FIFO cost flow assumptions, reveals that the market value (replacement cost) of the inventory as defined by GAAP is $530,000.
As you become aware of the additional information, you recognize that Zebra Manufacturing Company has made some significant account errors and omissions and that the balance sheet is not in proper format.
1. Prepare a corrected classified balance sheet, with footnotes as needed, in good form as of December 31, 2014. You may need to add new accounts to the balance sheet, as necessary.
2. You know that your supervisor will want a well-designed spreadsheet prepared for the audit file that explains all of the changes that you have made. She is always telling you that she “is not a mind reader” and cannot guess where changed numbers come from. Prepare a well-designed audit schedule for the audit file. For
every number on the final balance sheet, present a properly labeled computation showing the change in the number from the original to the revised number.
Lake Superior: Data collected by US Environmental Protection Agency, provided by J. Scharold. Lake Huron: Nalepa, ., . Fanslow, . Pothoven, . Foley III, . Lang, . Mozley, and . Winnell. 2007. Abundance and distribution of benthic macroinvertebrate populations in Lake Huron in 1972 and 2000-2003. NOAA Technical Memorandum GLERL-140. Ann Arbor, Michigan. Lake Michigan: Nalepa, ., . Fanslow, . Lang, . Lamarand, . Cummins, and . Carter. 2008. Abundance of the amphipod Diporeia and the mussels Dreissena polymorpha and Dreissena rostriformis bugensis in Lake Michigan in 1994-1995, 2000, and 2005. NOAA Technical Memorandum GLERL-144. Ann Arbor, Michigan. Lake Erie: Data collected through Lake Erie Collaborative Comprehensive Survey, provided by J. Ciborowski Lake Ontario: Watkins ., R. Dermott, . Lozano, . Mills, . Rudstam, and J. Scharold. 2007. Evidence for remote effects of dreissenid mussels on the amphipod Diporeia: analysis of Lake Ontario benthic surveys, 1972-2003. Journal of Great Lakes Research 33(3):642-657.