Refer to Exercise 3-27A.

Requirements
1. Use the data in the partial worksheet to prepare Winwood Production Company's classified balance sheet at December 31 of the current year. Use the report format. First you must compute the adjusted balance for several of the balance-sheet accounts.
2. Compute Winwood Production Company's net working capital, current ratio, and debt ratio at December 31. A year ago, net working capital was $3,900, the current ratio was 1.40, and the debt ratio was 0.64. Indicate whether the company's ability to pay its debts-both current and total-improved or deteriorated during the current year.

Transcribed Image Text:

Winwood Production Company Unadjusted Trial Balance 13,300 1,600 45,000 From the Adjusted Trial Balance Account Cash Prepaid rent Equipment Accumulated depreciation-equipment Accounts payable Salary payable Unearned service revenue Income tax payable Notes payable, long-term Common stock Retained earnings Dividends Service revenue Salary expense 3,300 4,900 9,200 16,000 8,400 11,4001 1300 13,600 19,900 Pent ecgtion expense equipment 4500 1,100 5,200 1,900 400 Depreciation expense-equipment Income tax expense Total 1200 66,800 66,8008,100 19,900