The balance sheet attached contains errors that are supposed to be corrected. I am confused on how the inventory and flexible budget part works please explain to me how to solve for those to correct the balance sheet, thank you. Please zoom in if cannot see balance sheet, screenshot is clear.

Survey of Accounting Comprehensive Assignment - Financial Statements & Flexible Budget As a team for the comprehensive problem, complete the following: 1. Review the completed horizontal balance sheet and correct the entries that contain errors. Background - You are a member of the company's executive team. As a team, you'll need to designate a role for each team member based on your declared major and relevant work and course experience. For example, an accounting major may be designated as the CFO, while a marketing major may be designated as the VP of marketing for the firm. Click here for a great article about who makes up an executive team. Remember - you have some flexibility here depending on your team's makeup. This document was provided by your accounting team for your review. As part of the executive team of this company, you will correct any errors and use the corrected version to construct a full set of financial statements, which will help guide your decision-making process. 2. Your team will use the CORRECTED horizontal balance sheet and templates provided to complete the following financial statements: Income Statement Vertical Balance Sheet Cash Flow Statement Statement on Stockholder's Equity 3. Use the complete set of financial statements as a basis for your management team's Advisory Board Meeting 4. Flexible budget (using template provided) to include the following assumptions: Three sales volume levels Sales Revenue at a projected sales price of $3.50 per unit at each volume level Cost of Goods Sold using weighted average method for the budget (Use inventory tracking sheet in template to calculate COGS using FIFO for the financial statements. Weighted average method is for the budget ONLY) Operating Expenses Fixed Costs pulled from your Horizontal Balance Sheet Calculate purchases for desired ending inventory of $35,000, assuming your ending inventory from the horizontal balance sheet is your beginning inventory for budgeting purposes. A breakeven calculation (show your work on the excel file) of how many bars you need to sell in order to break even. These items should be clearly identifiable in your submitted file: 1. Corrected horizontal balance sheet, 2. Complete set of financial statements, & 3. Flexible budget. Survey of Accounting Comprehensive Assignment - Financial Statements & Flexible Budget Executive Team Board Meeting Expectations Deliverable: recorded Executive Team Board Meeting Update (7-10 minutes) & summary of board meeting minutes Background - You are a member of the company's executive team. As a team, you'll need to designate a role for each team member based on your declared major and relevant work and course experience. The makeup of each team will vary based on the diversity of experience and area of focus within each team. For example, an accounting major may be designated as the CFO, while a marketing major may be designated as the VP of marketing for the firm. Be creative with this portion of your project. Your summary of the board meeting minutes should include a list of each member in attendance, including the position they hold with the company, along with a summary of your discussion points during the meeting. You should also record a more formal delivery of the content using Zoom or Microsoft Teams. Each member of your team should share the report related to their area of expertise. Discussion points may include, but are not limited to: How would the errors you identified have impact the financial statements had they been created based on the original document rather than your corrected version Sales numbers for the past three years are provided below: o One year ago: 410,000 units Two years ago: 395.000 units o Three years ago: 380,000 units Does your team agree or disagree with the flexible budget template provided by the accounting team? Use the practice homework #10 problems as a guide for this portion of your discussion. Provide supporting arguments for/against your conclusion. Relevant executives be sure to "weigh in" on the conversation with your thoughts. What trends do you see in these sales numbers when compared to the flexible budget? How could your team invest your cash flow differently to increase profits o Where would you invest and how would that impact your expenses Is there any additional information that could be provided by the accounting team that could be helpful? What types of decisions will each executive team member make using this information? Explain. 0 Survey of Accounting Comprehensive Assignment - Financial Statements & Flexible Budget Year 1 Transaction List: 1. Acquired $550,000 by signing a note payable with a local bank on Jan 1. 2. Sold 25,000 shares of $22 par value Common Stock for $1,500,000 3. Purchased Equipment for $300,000 cash 4. Purchased 25,000 units of Inventory on Account at $1.15 per unit 5. Sold 15,000 units at $3.50 on Account 6. Collected $70,000 of accounts receivable 7. Paid $17,250 of Accounts Payable 8. Purchased 170,000 units of Inventory on Account at $1.50 per unit 9. Sold 175,000 units at $3.50 on Account 10. Collected $472,500 of accounts receivable 11. Paid $118,600 of Accounts Payable 12. Purchased 275,000 units of Inventory on Account at $1.35 per unit 13. Sold 200,000 units at $3.50 on Account 14. Collected $735,000 of accounts receivable 15. Paid $294, 150 of Accounts Payable 16. Purchased 300,000 Units of Inventory on Account at $1.15 per unit 17. Record Sales & Marketing Expenses of $30,000 (paid in cash) 18. Record Operating Expenses of $75,708 (paid in cash) 19. Record Wage Expenses of $40,000 (paid in cash) 20. Record Product Line Research & Development Expenses of $150,000 (paid in cash) 21. Record Advertising Expenses of $87,500 (paid in cash) 22. Made the yearly required payment on the note payable. The note carries a 7% interest rate and requires payments of $50,000 plus interest each December 31. 23. Record Year 1 Depreciation on Equipment with Salvage Value of $38,000 and useful life of 7 Years (straight-line depreciation) 24. Declared a $10,000 cash dividend for stockholders 25. Paid a $10,000 cash dividend for stockholders Events Retained Earnings Account Titles for Retained Earnings $ 52.500 (17.2501 Sales Revenue Cost of Goods Sold 612.500 [184.750 Sales Revenue Costs of Goods Sold Balance Sheet Liab Equity Cash Act Rec Inventory Equipment Land Buildna. Accum Dep Acct Payable DIV Payable Notes Payable wages Payable common stock APIC 500.000 500.000 1.500.000 550.000 $ 950.000 300.000 $ 300.000 28.750 28.750 52.500 $ 117.2501 20.000 $ 70.000 117.250 17.250 $ 178.500 178.500 612.500 $ 1184.750 472.500 5 1472.500 (118.6001 [118.800.000 371.250 371.250 ES 700.000 1270.750 735.000 1735.000 294.150 294,150.00 345.000 345.000.00 30.000 175.7081 40.000 1150.000 187.500 Sales Revenue Costs of Goods Sold 1 Acquired $550.000 by signing a note payable with a local bank $ 2. Sold 25.000 shares of $22 Common Stock for $1.500.000 3. Purchased Equipment $ Purchased Inventory on Account - 25.000 units at $1.15 per unit Sa. Sold 15.000 units at $3.50 on Account Sb. COGS for Sales on Account 6. Collect $70.000 on Account 7. Paid $17.250 of Accounts Payable 8. Purchased Inventory on Account - 170.000 Units at $1.50 per unit 90. Sold 175.000 units at $3.50 on Account 9.COGS for Sales on Account 10. Collect $472.500 on Account 11. Paid $118.600 of Accounts Payable 12. Purchased Inventory on Account - 275.000 Units at $1.35 per unit 13a. Sold 200.000 units at $3.50 on Account 13b.COGS for Sales on Account 14. Collect $735,000 on Account S 15. Pad $294.150 of Accounts Payable 16. Purchased Inventory on Account - 300.000 units at $1.15 per unit 17. Record Sales & Marketing Expenses of $30,000 1a. Record Operating Expenses of $75.708 S 19. Record Wage Expenses of $40.000 20. Record Product Line Research & Development Expenses of $150,000 21. Record Advertising Expenses of $87.500 00 22. Made the yearly required payment on the note payable. The note cares a 7% interest $ rate and requires payments of $50.000 plus interest each December 31. 23. Record Yr 1 Depreciation on Equipment with Salvage Value of $38.000 & useful life of Yrs 24. Declared a $10,000 cash dividend forstockholders 25. Pada $10,000 cash didend forstockholders S Balance at end of Yr3 $ 1270.7501 130.000 175.7081 $ $ $ Marketing Expense Operating Expense Wage Expense Research & Development Expense Advertising Expense 150.000 187 5001 188.500 $ (50,000 $ (38.500 Interest Expense $ 37.428.57 $ [37.4291 Depreciation Expense 10.000.00 10.000.000 (10.0001 Dividends 110.000 2.105.7925 87.500 450.750 300.000 $ 37.4293 493.500 $ 450.000 40,000 550.000 $ 950.000 23.113 3 Total Acta Total Liquity 2.906.013 2015 3 Horizontal Bal Sheet - Blank Horizontal Bal Sheet for REVIEW Inventory Tracking Budget Template Income Statement Balance Sheet Stockholders' Equity Cash Flow + Goods Available for Sale Price/ Units Unit Total Cost of Goods Sold Price/ Units Unit Total Ending Inventory Price/ Units Unit Total Beg Bal Purchases: Total NOTE: You will need to calculate your estimated COGS for the budget template tab using the Weighted Avergae method discussed in L05-6 Flexible Budget Master Budget at Actual Units Sold in Year 1 Actual Units Sold +25,000 Actual Units Sold +50,000 Sales Revenue Cost of Goods Sold Gross Profit Operating Expenses Sales & Marketing Operating costs Wages Research & Development Expense Advertising Expense Depreciation Exp Interest Expense Net Income Inventory Production Beginning Inventory *use ending inventory from CORRECTED horizontal balance sheet for beginning inventory for the + Purchases - Estimated COGS = Desired Ending *actual units at weighted average COGS/unit Purchases Note: Calculate next year's estimated purchases for desired ending inventory of $35,000, assuming your ending inventory from the horizontal balance sheet is your beginning inventory for the next year. For Estimated COGS, use the previously calculated weighted average COGS and last years actual units Breakeven Calcuation BE=FC/(CM/Unit) Survey of Accounting Comprehensive Assignment - Financial Statements & Flexible Budget As a team for the comprehensive problem, complete the following: 1. Review the completed horizontal balance sheet and correct the entries that contain errors. Background - You are a member of the company's executive team. As a team, you'll need to designate a role for each team member based on your declared major and relevant work and course experience. For example, an accounting major may be designated as the CFO, while a marketing major may be designated as the VP of marketing for the firm. Click here for a great article about who makes up an executive team. Remember - you have some flexibility here depending on your team's makeup. This document was provided by your accounting team for your review. As part of the executive team of this company, you will correct any errors and use the corrected version to construct a full set of financial statements, which will help guide your decision-making process. 2. Your team will use the CORRECTED horizontal balance sheet and templates provided to complete the following financial statements: Income Statement Vertical Balance Sheet Cash Flow Statement Statement on Stockholder's Equity 3. Use the complete set of financial statements as a basis for your management team's Advisory Board Meeting 4. Flexible budget (using template provided) to include the following assumptions: Three sales volume levels Sales Revenue at a projected sales price of $3.50 per unit at each volume level Cost of Goods Sold using weighted average method for the budget (Use inventory tracking sheet in template to calculate COGS using FIFO for the financial statements. Weighted average method is for the budget ONLY) Operating Expenses Fixed Costs pulled from your Horizontal Balance Sheet Calculate purchases for desired ending inventory of $35,000, assuming your ending inventory from the horizontal balance sheet is your beginning inventory for budgeting purposes. A breakeven calculation (show your work on the excel file) of how many bars you need to sell in order to break even. These items should be clearly identifiable in your submitted file: 1. Corrected horizontal balance sheet, 2. Complete set of financial statements, & 3. Flexible budget. Survey of Accounting Comprehensive Assignment - Financial Statements & Flexible Budget Executive Team Board Meeting Expectations Deliverable: recorded Executive Team Board Meeting Update (7-10 minutes) & summary of board meeting minutes Background - You are a member of the company's executive team. As a team, you'll need to designate a role for each team member based on your declared major and relevant work and course experience. The makeup of each team will vary based on the diversity of experience and area of focus within each team. For example, an accounting major may be designated as the CFO, while a marketing major may be designated as the VP of marketing for the firm. Be creative with this portion of your project. Your summary of the board meeting minutes should include a list of each member in attendance, including the position they hold with the company, along with a summary of your discussion points during the meeting. You should also record a more formal delivery of the content using Zoom or Microsoft Teams. Each member of your team should share the report related to their area of expertise. Discussion points may include, but are not limited to: How would the errors you identified have impact the financial statements had they been created based on the original document rather than your corrected version Sales numbers for the past three years are provided below: o One year ago: 410,000 units Two years ago: 395.000 units o Three years ago: 380,000 units Does your team agree or disagree with the flexible budget template provided by the accounting team? Use the practice homework #10 problems as a guide for this portion of your discussion. Provide supporting arguments for/against your conclusion. Relevant executives be sure to "weigh in" on the conversation with your thoughts. What trends do you see in these sales numbers when compared to the flexible budget? How could your team invest your cash flow differently to increase profits o Where would you invest and how would that impact your expenses Is there any additional information that could be provided by the accounting team that could be helpful? What types of decisions will each executive team member make using this information? Explain. 0 Survey of Accounting Comprehensive Assignment - Financial Statements & Flexible Budget Year 1 Transaction List: 1. Acquired $550,000 by signing a note payable with a local bank on Jan 1. 2. Sold 25,000 shares of $22 par value Common Stock for $1,500,000 3. Purchased Equipment for $300,000 cash 4. Purchased 25,000 units of Inventory on Account at $1.15 per unit 5. Sold 15,000 units at $3.50 on Account 6. Collected $70,000 of accounts receivable 7. Paid $17,250 of Accounts Payable 8. Purchased 170,000 units of Inventory on Account at $1.50 per unit 9. Sold 175,000 units at $3.50 on Account 10. Collected $472,500 of accounts receivable 11. Paid $118,600 of Accounts Payable 12. Purchased 275,000 units of Inventory on Account at $1.35 per unit 13. Sold 200,000 units at $3.50 on Account 14. Collected $735,000 of accounts receivable 15. Paid $294, 150 of Accounts Payable 16. Purchased 300,000 Units of Inventory on Account at $1.15 per unit 17. Record Sales & Marketing Expenses of $30,000 (paid in cash) 18. Record Operating Expenses of $75,708 (paid in cash) 19. Record Wage Expenses of $40,000 (paid in cash) 20. Record Product Line Research & Development Expenses of $150,000 (paid in cash) 21. Record Advertising Expenses of $87,500 (paid in cash) 22. Made the yearly required payment on the note payable. The note carries a 7% interest rate and requires payments of $50,000 plus interest each December 31. 23. Record Year 1 Depreciation on Equipment with Salvage Value of $38,000 and useful life of 7 Years (straight-line depreciation) 24. Declared a $10,000 cash dividend for stockholders 25. Paid a $10,000 cash dividend for stockholders Events Retained Earnings Account Titles for Retained Earnings $ 52.500 (17.2501 Sales Revenue Cost of Goods Sold 612.500 [184.750 Sales Revenue Costs of Goods Sold Balance Sheet Liab Equity Cash Act Rec Inventory Equipment Land Buildna. Accum Dep Acct Payable DIV Payable Notes Payable wages Payable common stock APIC 500.000 500.000 1.500.000 550.000 $ 950.000 300.000 $ 300.000 28.750 28.750 52.500 $ 117.2501 20.000 $ 70.000 117.250 17.250 $ 178.500 178.500 612.500 $ 1184.750 472.500 5 1472.500 (118.6001 [118.800.000 371.250 371.250 ES 700.000 1270.750 735.000 1735.000 294.150 294,150.00 345.000 345.000.00 30.000 175.7081 40.000 1150.000 187.500 Sales Revenue Costs of Goods Sold 1 Acquired $550.000 by signing a note payable with a local bank $ 2. Sold 25.000 shares of $22 Common Stock for $1.500.000 3. Purchased Equipment $ Purchased Inventory on Account - 25.000 units at $1.15 per unit Sa. Sold 15.000 units at $3.50 on Account Sb. COGS for Sales on Account 6. Collect $70.000 on Account 7. Paid $17.250 of Accounts Payable 8. Purchased Inventory on Account - 170.000 Units at $1.50 per unit 90. Sold 175.000 units at $3.50 on Account 9.COGS for Sales on Account 10. Collect $472.500 on Account 11. Paid $118.600 of Accounts Payable 12. Purchased Inventory on Account - 275.000 Units at $1.35 per unit 13a. Sold 200.000 units at $3.50 on Account 13b.COGS for Sales on Account 14. Collect $735,000 on Account S 15. Pad $294.150 of Accounts Payable 16. Purchased Inventory on Account - 300.000 units at $1.15 per unit 17. Record Sales & Marketing Expenses of $30,000 1a. Record Operating Expenses of $75.708 S 19. Record Wage Expenses of $40.000 20. Record Product Line Research & Development Expenses of $150,000 21. Record Advertising Expenses of $87.500 00 22. Made the yearly required payment on the note payable. The note cares a 7% interest $ rate and requires payments of $50.000 plus interest each December 31. 23. Record Yr 1 Depreciation on Equipment with Salvage Value of $38.000 & useful life of Yrs 24. Declared a $10,000 cash dividend forstockholders 25. Pada $10,000 cash didend forstockholders S Balance at end of Yr3 $ 1270.7501 130.000 175.7081 $ $ $ Marketing Expense Operating Expense Wage Expense Research & Development Expense Advertising Expense 150.000 187 5001 188.500 $ (50,000 $ (38.500 Interest Expense $ 37.428.57 $ [37.4291 Depreciation Expense 10.000.00 10.000.000 (10.0001 Dividends 110.000 2.105.7925 87.500 450.750 300.000 $ 37.4293 493.500 $ 450.000 40,000 550.000 $ 950.000 23.113 3 Total Acta Total Liquity 2.906.013 2015 3 Horizontal Bal Sheet - Blank Horizontal Bal Sheet for REVIEW Inventory Tracking Budget Template Income Statement Balance Sheet Stockholders' Equity Cash Flow + Goods Available for Sale Price/ Units Unit Total Cost of Goods Sold Price/ Units Unit Total Ending Inventory Price/ Units Unit Total Beg Bal Purchases: Total NOTE: You will need to calculate your estimated COGS for the budget template tab using the Weighted Avergae method discussed in L05-6 Flexible Budget Master Budget at Actual Units Sold in Year 1 Actual Units Sold +25,000 Actual Units Sold +50,000 Sales Revenue Cost of Goods Sold Gross Profit Operating Expenses Sales & Marketing Operating costs Wages Research & Development Expense Advertising Expense Depreciation Exp Interest Expense Net Income Inventory Production Beginning Inventory *use ending inventory from CORRECTED horizontal balance sheet for beginning inventory for the + Purchases - Estimated COGS = Desired Ending *actual units at weighted average COGS/unit Purchases Note: Calculate next year's estimated purchases for desired ending inventory of $35,000, assuming your ending inventory from the horizontal balance sheet is your beginning inventory for the next year. For Estimated COGS, use the previously calculated weighted average COGS and last years actual units Breakeven Calcuation BE=FC/(CM/Unit)