The adjusted trial balance for Tybalt Construction as of December 31, 2018, follows. Tybalt Construction is required to make a $7,000 payment on its long-term notes payable during 2019.

Required

1. Prepare the income statement and the statement of retained earnings for the calendar year 2018 and the classified balance sheet at December 31, 2018.

2. Prepare the necessary closing entries at December 31, 2018.

3. Use the information in the financial statements to compute these ratios: (a) return on assets (total assets at December 31, 2017, was $200,000); (b) debt ratio; (c) profit margin ratio (use total revenues as the denominator); and (d) current ratio. Round ratios to three decimals for parts a and c, and to two decimals for parts b and d.

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TYBALT CONSTRUCTION Adjusted Trtal Balance December 31, 2018 No. Account Tile Debit Credit $ 5.000 101 Cash 104 Short-term investments 23,000 Supplies . 126 8,100 128 Propaid insuranco 7,000 167 Equipment.. Accumulated depreciation-Equipment. 40,000 $ 20,000 168 173 Building.... 150,000 Accumulated depreciation-Building 174 50,000 Land.. 55.000 183 Accounts payable. 201 16,500 Interest payable . 2,500 203 3,500 208 Rent payable. 210 Wages payable. 2,500 213 Proporty taxos payablo 900 233 Uneamed professional fees. 7,500 251 Long-term notes payable. 67,000 Common stock... 307 5,000 318 Retained eamings, December 31, 2017. 121,400 319 Dividends 13,000 401 Professional fees earned. 97,000 406 Rent earned 14.000 407 Dividends earned. 2,000 409 Interest earned... Doprociation oxponso-Bulding. 2,100 606 11,000 612 Depreciation expense-Equipment. 6,000 623 Wages expense 32,000 633 Interest expense. 5,100 Insurance expense. 637 10,000 Rent expense 13,400 640 Supplies expense. 7,400 652 682 Postage expense 4,200 683 Property taxes expers Repairs expense.. 5,000 8,900 684 Tolaphone expense 688 3,200 Utilities expense.. Totals... 4,600 690 $411,900 $411,900