The following incomplete balance sheet for the Sanderson Manufacturing Company was prepared by the company?s controller. As accounting manager for Sanderson, you are attempting to reconstruct and revise the balance sheet.

Additional Information ($ in thousands):1. Certain records that included the account balances for the patent and shareholders? equity items were lost. However, the controller told you that a complete, preliminary balance sheet prepared before the records were lost showed a debt to equity ratio of 1.2. That is, total liabilities are 120% of total shareholders? equity. Retained earnings at the beginning of the year was $4,000. Net income for 2021 was $1,560 and $560 in cash dividends were declared and paid to shareholders.2. Management intends to sell the investments in the next six months.3. Interest on both the notes and the bonds is payable annually.4. The notes payable are due in annual installments of $1,000 each.5. Deferred revenue will be recognized as revenue equally over the next two fiscal years.6. The common stock represents 400,000 shares of no par stock authorized, 250,000 shares issued and outstanding.

Required:Prepare a complete, corrected, classified balance sheet. Include headings for each classification, as well as titles for each classification?s subtotal. An example of a classified balance sheet can be found in the Concept Review Exercise at the end of Part A of this chapter.

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Sanderson Manufacturing Company Balance Sheet At December 31, 2021 ($ in thousands) Assets Current assets: $ 1,250 3,500 Cash Accounts receivable Allowance for uncollectible accounts (400) 6,000 Finished goods inventory Prepaid expenses 1,200 11,550 Total current assets Long-term assets: 3,000 2,250 Investments Raw materials and work in process inventory Equipment Accumulated depreciation Patent (net) 15,000 (4,200) ? Total assets Liabilities and Shareholders' Equity Current liabilities: $ 5,200 4,000 Accounts payable Notes payable Interest payable (on notes) 100 Deferred revenue 3,000 Total current liabilities 12,300 Long-term liabilities: Bonds payable Interest payable (on bonds) Shareholders' equity: 5,500 200 $ ? Common stock Retained earnings ? Total liabilities and shareholders' equity %24