25 points) The long-time bookkeeper of Madrigal Industries recently retired. The company has not yet replaced them and the owner asked the receptionist to prepare a balance sheet for the company at year end. While the receptionist has no experience in accounting, they did find an old book about accounting to reference. The following balance sheet was prepared. Identify ten suggestions for improvements in the format of the balance sheet. Consider both terminology deficiencies as well as classification inaccuracies. Madrigal Industries, Inc. Balance Sheet For the Year Ended 12/31/22 Assets Fixed AssetsTangible Equipment $110,000 Less: reserve for depreciation (40,000) $ 70,000 Factory supplies 22,000 Land and buildings 400,000 Less: reserve for depreciation (150,000) 250,000 Plant site held for future use 90,000 $ 432,000 Current Assets Accounts receivable 175,000 Cash 80,000 Inventory [See note 1] 240,000 495,000 Fixed Assets--Intangible Goodwill 80,000 Notes receivable 40,000 Patents 26,000 146,000 Deferred Charges Advances to salespersons 60,000 Prepaid rent 27,000 Returnable containers 75,000 162,000 Total Assets $1,235,000 Liabilities Current Liabilities Accounts payable $140,000 Allowance for doubtful accounts 8,000 Unearned revenue 35,000 Income taxes payable 42,000 Sales tax payable 17,000 $ 242,000 Long-term Liabilities, 5% debenture bonds, due 2028 500,000 Reserve for contingencies [See note 2] 150,000 650,000 Total Liabilities 892,000 Equity Capital stock, $10 par value, issued 15,000 shares $150,000 Capital surplus 90,000 Dividends paid (20,000) Earned surplus 123,000 Total Equity 343,000 Total Liabilities and Equity $1,235,000

Note 1. The inventory account includes only items physically present at the main plant and warehouse. Items located at the company's branch sales office amounting to $40,000 are excluded since the company has consistently followed this procedure for many years. Note 2. The reserve for contingencies has been created by a debit to earned surplus and has been established to provide a cushion for future uncertainties