Refer to Exercise 3-44B.

Requirements
1. Use the data in the partial worksheet to prepare Durkin 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 Durkin Production Company€™s net working capital, current ratio and debt ratio at December 31. A year ago, the net working capital was $7,000, the current ratio was 1.70, and the debt ratio was 0.40. Indicate whether the company€™s ability to pay its debts€”both current and total€”improved or deteriorated during the currentyear.

Transcribed Image Text:

Durkin Production Company Unadjusted Trial Balance From the Adjusted Trial Balance Account 14,200 1,500 44,000 Prepaid rent Equipment Accumulated depreciation Accounts payable Salary payable Unearned service revenue Income tax payable Notes payable, long-term Common stock Retained earnings Dividends Service revenue Salary expense Rent expense Depreciation expense Income tax expense Total 3,500 4,700 8,400 17,000 8,700 11,400 1,100 13,300 19,600 4,700 1,500 2,300 600 1,200 67,000 67,000 970019.600