The following information is from the June 30, 2011, post-closing trial balance of Beauty Supplies Corporation. 

Required 

1. From the information provided, prepare a classified balance sheet for Beauty Supplies Corporation. 

2. Compute Beauty Supplies’ current ratio and debt to equity ratio. 

3. As a user of the classified balance sheet, why would you want to know the current ratio or the debt to equity ratio?

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Credit Account Name Debit $ 16,000 16,500 5,000 138,000 72,500 800 Cash Short-Term Investments Notes Receivable Accounts Receivable Merchandise Inventory Prepaid Rent Prepaid Insurance Sales Supplies Office Supplies Deposit for Future Advertising Building, Not in Use 2,400 640 220 1,840 24,800 11,700 20,600 Land Delivery Equipment Accumulated Depreciation–Delivery Equipment Trademark Accounts Payable Salaries Payable Interest Payable Long-Term Notes Payable Common Stock ($1.10 par value) Additional Paid-in Capital Retained Earnings $ 14,200 2,000 57,300 2,600 920 40,000 11,000 80,000 106,980