The following trial balance was prepared by Vantage Electronics Corporation, a Canadian private enterprise, as of 31 December 20X5. The adjusting entries for 20X5 have been made, except for any related to the specific information noted below. Vantage Electronics Trial Balance 31 December 20X5 $13,000 13,000 10,000 Cash Accounts receivable Inventories Equipment Land 18,000 4,300 6,840 Building Prepaid expenses Accounts payable Note payable, 11 Share capital, 2,510 shares outstanding Retained earnings 980 $ 4,300 10,800 24,300 26,720 Totals $66,120 $66,120 Other information You find that certain errors and omissions are reflected in the trial balance below a. The $13,000 balance in accounts receivable represents the entire amount owed to the company; of this amount, $11,800 is from trade customers and 5% of that amount is estimated to be uncollectible. The remaining amount owed to the company represents a long-term advance to its president. b. Inventories include $1,300 of goods incorrectly valued at double their cost (i.e., reported at $2,600). No correction has been recorded. Office supplies on hand of $7O0 are also included in the balance of inventories. c. When the equipment and building were purchased new on 1 January 20XO (i.e., six years earlier), they had estimated lives of 10 and 25 years, respectively. They have been amortized using the straight-line method on the assumption of zero residual value, and depreciation has been credited directly to the asset accounts. Amortization has been recorded for 20X5 d. The balance in the land account includes a $1,500 payment made as a deposit on the purchase of an adjoining tract. The option to buy it has not yet been exercised and probably will not be exercised during the coming year. e. The interest-bearing note dated 1 April 20X5 matures 31 March 20X6. Interest on it has not been recorded for 20x5 Required: 1. Prepare a balance sheet. (List accounts in order of their liquidity.) VANTAGE ELECTRONICS CORPORATION Balance Sheet 31 December 20X5 (Amounts in Canadian dollars) Assets Current assets: $ 13,000 Cash $ Accounts receivable 11,800 (590) Less: Allowance for doubtful accounts 11,210 Merchandise inventory 8,000 Office supplies inventory 700 Prepaid expenses 980 Total current assets 33,890 Long-term investment: Capital assets: 2,800 Land Equipment Less: Accumulated depreciation Building Less: Accumulated depreciation Total capital assets 2,800 Building Less: Accumulated depreciation Total capital assets 2,800 Other assets: Due from officers 1,200 $ 37,890 Total assets Liabilities Current liabilities: Accounts payable 4,300 Notes payable 10,800 Interest payable 15,100 Total liabilities Shareholders' Equity Contributed capital Common shares $ 24,300 Retained earnings Total shareholders' equity 24,300 $ Total liabilities and shareholders' equity 39,400 2. Calculate the ending balance in retained earnings. Opening balance $ 26,720 Reduction for bad debt expense (590) Reduction for inventory overstatement Reduction for interest expense Ending balance