Final answer:
The balance sheet for Lawson Consulting is prepared using provided assets, liabilities, and equity, with an emphasis on retained earnings. The total assets, however, do not match total liabilities and equity, indicating an error in the provided information or the need for additional details.
Step-by-step explanation:
Balance Sheet Preparation for Lawson Consulting
To prepare the balance sheet for Lawson Consulting as of December 31, we need to consider the following information:
Using the given information, the balance sheet as of December 31 would look like this:
Assets
Liabilities
Equity
Note that Equity comprises both the contributed capital (common stock) and the retained earnings.
To confirm accuracy, the total assets ($130) must equal the sum of total liabilities and equity. In this case:
Total Assets = Reserves + Bonds + Loans = $30 + $50 + $50 = $130
Total Liabilities and Equity = Deposits + Common Stock + Retained Earnings = $300 + $30 + $2,400
This creates a discrepancy as the liabilities and equity total ($2,730) does not match the assets ($130). There may be an error in the given information, or additional details may be required to correctly prepare the balance sheet.