The current assets and current liabilities sections of the balance sheet of Cullumber Co. appear as follows. Cullumber Co. Balance Sheet (Partial) As of December 31, 2017 Cash $ 17,400 $ 28,400 Accounts payable Notes payable Accounts receivable $ 40.400 14,000 Less: Allowance for doubtful accounts 3,000 37,400 2.500 Unearned revenue Total current liabilities Inventory 63,400 $44,900 Prepaid expenses 7,300 Total current assets $ 125,500 The following errors in the corporation's accounting have been discovered: 1. 2. 3. Keane collected $4.500 on December 20, 2017 as a down payment for services to be performed in January, 2018. The company's controller recorded the amount as revenue. The inventory amount reported included $ 2,900 of merchandise that had been received on December 31, 2017 but for which no purchase invoices had been received or entered. Of this amount $ 2,800 had been received on consignment; the remainder was purchased fo.b.destination, terms 2/10,n/30. Sales for the first day in January 2018 in the amount of $ 12,000 were entered in the sales journal as of December 31, 2017 Of these, $ 6,600 were sales on account and the remainder were cash sales. Cash, collected in December 2017, but entered as received in January 2018 totaled $3,200. Of this amount, $2,156 was received on account after cash discounts of 2% had been deducted; the remainder was collected for cash sales. Cash of $5,000 received in January 2018 was entered as received in December 2017. This cash represented the proceeds of a bank loan that matures in July 2018. January 2018 cash disbursements entered as of December 2017 included payments of accounts payable in the amount of $ 7,800, on which a cash discount of 1% was taken. 4. 5. 6. Restate the current assets and current liabilities sections of the balance sheet in accordance with good accounting practice. (Assume that both accounts receivable and accounts payable are recorded gross.) (List Current Assets in order of liquidity.) CULLUMBER COMPANY Balance Sheet (Partial) December 31, 2017 Asset Current Assets Cash $ 17922 Accounts Receivable $ 31600 Less Allowance for Doubtful Accounts 3000 28600 Inventory 60600 Prepaid Expenses 7300 Total Current Assets 114422 Liabilities and Stockholders' Equity Current Liabilities Accounts Payable $ 36300 Notes Payable 9000 Unearned Revenue 7000 Total Current Liabilities $ 52300 State the net effect of your adjustments on Cullumber's retained earnings balance. to retained earnings $