Rice Corporation is negotiating a loan for expansion purposes and the bank requires financial statements. Beforeclosing the accounting records for the year ended December 31, 2021, Rice?s controller prepared the followingfinancial statements:

Additional Information:1. The company?s common stock is traded on an organized stock exchange.2. The investment portfolio consists of short-term investments valued at $57,000. The remaining investmentswill not be sold until the year 2023.3. Notes payable consist of two notes: Note 1: $80,000 face value dated September 30, 2021. Principal and interestat 10% are due on September 30, 2022.Note 2: $120,000 face value dated April 30, 2021. Principal is due in two equal installments of $60,000 plusinterest on the unpaid balance. The two payments are scheduled for April 30, 2022, and April 30, 2023.Interest on both loans has been correctly accrued and is included in accrued liabilities on the balance sheetand selling and administrative expense in the income statement.4. Selling and administrative expense includes $90,000 representing costs incurred by the company in restructuringsome of its operations. The amount is material.Required:Identify and explain the deficiencies in the presentation of the statements prepared by the company?s controller.Do not prepare corrected statements. Include in your answer a list of items that require additional disclosure, eitheron the face of the statement or in a note.

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RICE CORPORATION Balance Sheet At December 31, 2021 ($ in thousands) Assets $ 275 Cash Investments 78 487 Accounts receivable Inventory Allowance for uncollectible accounts 425 (50) Property and equipment (net) 160 Total assets $1,375 Liabilities and Shareholders' Equity Accounts payable and accrued liabilities Notes payable $ 420 200 Common stock 260 Retained earnings 495 Total liabilities and shareholders' equity $1,375 RICE CORPORATION Income Statement For the Year Ended December 31, 2021 ($ in thousands) $1,580 Sales revenue Expenses: Cost of goods sold Selling and administrative expense Miscellaneous expense $755 385 129 Income tax expense 100 Total expenses 1,369 $ 211 Net income