Using the information from the alphabetized post-closing trial balance below, prepare a classified balance sheet for Sassy Pharmaceuticals Inc. as at March 31, 2020. Be sure to use proper form, including all appropriate subtotals.

Account Description Account Balance*
Accounts payable .......................................................... $ 20,000
Accounts receivable ......................................................... 66,800
Accumulated amortization, patent ................................ 50,000
Accumulated depreciation, equipment ...................... 148,400
Accumulated depreciation, vehicles ............................. 62,000
Advertising payable........................................................... 2,600
Allowance for doubtful accounts .................................... 3,200
Cash .................................................................................. 28,400
Common shares, 100,000 shares authorized; 25,000 shares were issued at an average price of $9.20; market price per share on

March 31, 2020, was $10.40 .................................... ?
Equipment ................................................................. 464,000
Income tax payable .................................................... 54,800
Notes payable** ....................................................... 140,000
Patent ......................................................................... 114,800
Prepaid rent ............................................................... 54,800
Retained earnings .......................................................... ?
Unearned revenues ................................................... 27,200
Vehicles ........................................................................ 81,200

Analysis Component:

1. What percentage of the assets is financed by debt?

2. What percentage of the assets is financed by equity?

3. Assuming that 37% of the company’s assets were financed by debt at March 31, 2019, has the balance sheet been strengthened over the current year?

When a balance sheet is said to have been strengthened, it means, in general, that total liabilities (or risk associated with debt financing) have decreased and equity has increased.