PI$2-9$Comprchensive Lee Manutacturing Corporation was incorporated on January $3,2018.$ The corporation'sfinancial statements tor its first year's operations were not examincd by a CPA, You have bcen engaged to examinethe tinancial statements for the vear cnded December $31,2019,$ and your examination is substantially completed$\mathrm{.}124$ Lee's trial balanee at Decenmber $31,2019,$ appcars as follows:LO $12\mathrm{.}5$LO $12\mathrm{.}1$LO $12\mathrm{.}2$AICPAAdapted Cash$3$Accounts receivableAllowance for doubtful accountsInventoriesMachineryEquipmentAccumulated depreciationPatentLeasehold improvementsPrepaid expensesOrganization costsGoodwill$1$licensing Agreement No$.1$Licensing Agreement No$.2$Accounts payableUnearned revenueCommon stockRetained earnings, January $1,2019$SalesCost of goods soldSelling and general expensesInterest expenseTotalDebit$61,00092,50038,50075,00029,000$Required:$85,00026,00010,50029,00024,00050,00049,00027,000466,000173,0003,500$$$1,239,000$$Credit$50010,000147,50012,500300,000768,500$The following information relates to accounts that may yet require adjustment:$$1,239,000$Patents for Lee's manufacturing process were acquired January $2,2019,$ at a cost of S$68,000.$ An additionalS$17,000$ was spent in December $2019$ to improve machinery covered by the patents and charged to the Patentaccount. Depreciation on fixed assets has been properly recorded for $2019$ in accordance with Lee's practicewhich provides a full year's depreciation for property on hand June $30$ and no depreciation otherwise. Lee usesthe straight$-$line method for all depreciation and amortization and amortizes its patents over their legal life$\mathrm{.}2.$ On January $3,2018,$ Lee purchased Licensing Agrecment No$.1,$ which was believed to have an indefiniteuseful life. The balance in the Licensing Agreement No$.$ l account includes its purchase price of S$48,000$ andcosts of S$2,000$ related to the acquisition. On January $1,2019,$ Lee purchased Licensing Agreement No$.2,$which has a life expectancy of $10$ years. The balance in the Licensing Agrcement No$.2$ account includes itsS$48,000$ purchase price and $$2,000$ in acquisition costs, but it has been reduced by a credit of Sl$,000$ forthe advance collection of $2020$ revenue from the agreement. In late December $2018,$ an explosion caused apermanent $60\%$ reduction in the expected revenue$-$producing value of Licensing Agreement No$.1,$ and inJanuary $2020$ a flood caused additional danmage that rendered the agreement worthless$\mathrm{.}12-37$The balance in the Goodwill account includes $($a$)$ S$8,000$ paid December $30,2018,$ for newspaper advertisingfor the next $4$ vears following the payment, and $($b$)$ legal costs of Sl$6,000$ incurred for Lee's incorporation onJanuary $3,2018\mathrm{.}4.$ The Leasehold ImprOvements account includes $($a$)$ the S$15,000$ cost of improvements with a total estimateduseful life of $12$ years, which Lee, as tenant, made to leascd premises in January $2018$; $($b$)$ movable assemblyline equipment costing S$8,500$ that was installed in the leased premises in December $2019$: and $($c$)$ real estaretaxes of $$2,500$ paid by Lee in $2019,$ which under the terms of the lease should have been paid by the land$-$lord. Lee paid its rent in full during $2019.$ A $10-$year nonrenewable lease was signed January $3,2018,$ for theleased building that Lec used in manufacturing operations$\mathrm{.}5.$ The balance in the Organization Costs account includes costs incurred during the organizational period.Prepare a workshcct $($spreadsheet$)$ to adjust accounts that require adjustment and prepare financial statements.Formal adjusting journal entries and financial statements are not required. No intangible assets are impaired at theend of $2019.$ Ignore income taxes.