The adjusted trial balance of Rosaire Irrigation System at December 31, 2025, follows:

Requirements 

1. Prepare the company’s income statement for the year ended December 31, 2025. 

2. Prepare the company’s statement of retained earnings for the year ended December 31, 2025. 

3. Prepare the company’s classified balance sheet in report form at December 31, 2025. 

4. Journalize the closing entries for Rosaire Irrigation System. 

5. Compute the company’s current ratio at December 31, 2025. At December 31, 2024, the current ratio was 2.20. Did the company’s ability to pay current debts improve or deteriorate, or did it remain the same?

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Account Title Cash ROSAIRE IRRIGATION SYSTEM Adjusted Trial Balance December 31, 2025 Accounts Receivable Supplies Prepaid Insurance Land Building Accumulated Depreciation-Building Equipment Accumulated Depreciation-Equipment Accounts Payable Interest Payable Salaries Payable Unearned Revenue Notes Payable (long-term) Common Stock Retained Earnings Dividends Service Revenue Insurance Expense Salaries Expense Supplies Expense Interest Expense Depreciation Expense-Building Depreciation Expense-Equipment Total Balance Debit $ 6,500 23,600 3,300 4,800 20,000 58,200 23,000 5,000 500 17,700 1,600 100 5,000 20,000 $ 189,300 Credit $ 24,200 6,900 22,300 100 2,800 1,800 4,200 50,000 37,000 40,000 $ 189,300