On January $1,2024,$ the general ledger of Freedom Fireworks includes the following account balances:

AccountsDebitCreditCash$ $101,500$Accounts receivable$34,600$Inventory$152,300$Land$70,300$Buildings$123,000$Allowance for uncollectible accounts$$$ $2,100$Accumulated depreciation$9,900$Accounts payable$21,000$Bonds payable$123,000$Discount on bonds payable$30,300$Common stock$203,000$Retained earnings$153,000$Totals$ $512,000$$ $512,000$

During January $2024,$ the following transactions occurred:

January $1$Borrowed $$103,000$ from Captive Credit Corporation. The installment note bears interest at $6\%$ annually and matures in $5$ years. Payments of $$1,991\mathrm{.}28$ are required at the end of each month for $60$ months.January $1$Called the bonds at the contractual call price of $$103,000.$ The $5\%$ bonds pay interest semiannually each June $30$ and December $31.$January $4$Received $$31,300$ from customers on accounts receivable.January $10$Paid cash on accounts payable, $$14,000.$January $15$Paid cash for salaries, $$29,200.$January $30$Firework sales for the month totalled $$195,600.$ Sales included $$65,300$ for cash and $$130,300$ on account. The cost of the units sold was $$114,000.$January $31$Paid the first monthly installment of $$1,991$ related to the $$103,000$ borrowed on January $1.$

The following information is available on January $31,2024.$

Depreciation on the building for the month of January is calculated using the straight$-$line method. At the time the building was purchased, the company estimated a service life of $10$ years and a residual value of $$24,600.$

At the end of January, $$3,300$ of accounts receivable are past due, and the company estimates that $50\%$ of these accounts will not be collected. Of the remaining accounts receivable, the company estimates that $2\%$ will not be collected. No accounts were written off as uncollectible in January.

Unpaid salaries at the end of January are $$26,400.$

Accrued income taxes at the end of January are $$5,300.$

$-$ Prepare an income statement for the period ended$$January $31,2024.$ Choose the appropriate accounts to complete the company's income statement. The unadjusted, adjusted, or post$-$closing balances will appear for each account, based on your selection

$-$ Prepare a classified balance sheet as of January $31,2024.$ Choose the appropriate accounts to complete the company's balance sheet. The unadjusted, adjusted, or post$-$closing balances will appear for each account, based on your selection.

$-$ Using the information from the requirements above, complete the 'Analysis'. Requirement

General

General

Income Journal

Trial Balance

Statement

Balance Sheet

Analysis

Prepare a classified balance sheet as of January $31,2024.$ Choose the appropriate accounts to complete the company's balance sheet. The unadjusted, adjusted, or post$-$closing balances will appear for each account, based on your selection.

Adjusted

Dates:

January $01$

to:

January $31$

$\backslash$begin$\{$tabular$\}\{|$c$|$c$|$c$|$c$|$c$|$c$|\}$

$\backslash$hline $\backslash$multicolumn$\{6\}\{|$c$|\}\{$Freedom Fireworks$\}\backslash \backslash$

$\backslash$hline $\backslash$multicolumn$\{6\}\{|$c$|\}\{$Classified Balance Sheet$\}\backslash \backslash$

$\backslash$hline $\backslash$multicolumn$\{6\}\{|$c$|\}\{$January $31,2024\}\backslash \backslash$

$\backslash$hline $\backslash$multicolumn$\{3\}\{|$l$|\}\{$Assets$\}$ & $\backslash$multicolumn$\{3\}\{|$l$|\}\{$Liabilities$\}\backslash \backslash$

$\backslash$hline Current assets: & & & Current liabilities: & & $\backslash \backslash$

$\backslash$hline Cash & $\backslash$$ & $152,909$ & Accounts payable & $\backslash (\{\}\_\{\backslash$text $\{\backslash$$ $\}\}\backslash )$ & $21,000\backslash \backslash$

$\backslash$hline Accounts receivable & $\backslash$$ & $147,600$ & Salaries payable & & $26,400\backslash \backslash$

$\backslash$hline Allowance for uncollectible accounts & $\backslash$$ & $\backslash ((4,256)\backslash )$ & Income tax payable & & $5,300\backslash \backslash$

$\backslash$hline Inventory & & $38,300$ & & & $0\backslash \backslash$

$\backslash$hline & & & Total current liabilities & & $52,700\backslash \backslash$

$\backslash$hline & & & Long$-$term liabilities & & $\backslash \backslash$

$\backslash$hline & & & Notes payable & $*$ & $101,524\backslash \backslash$

$\backslash$hline & & & & & $0\backslash \backslash$

$\backslash$hline Total current assets & & $334,553$ & Total liabilities & & $154,224\backslash \backslash$

$\backslash$hline Non$-$current assets: & & & $\backslash$multicolumn$\{3\}\{|$l$|\}\{$Stockholders$\text{'}$ equity$\}\backslash \backslash$

$\backslash$hline Land & & $70,300$ & Common stock & $+$ & $203,000\backslash \backslash$

$\backslash$hline Buildings & $$ & $123,000$ & Retained earnings & & $165,209\backslash \backslash$

$\backslash$hline Accumulated depreciation & $\backslash (\{\}^\{\backslash$text $\{\backslash$$ $\}\}\backslash )$ & $\backslash ((10,720)\backslash )$ & & & $\backslash \backslash$

$\backslash$hline & & & Total stockholders' equity & & $368,209\backslash \backslash$

$\backslash$hline Total assets & $\backslash$$ & $517,133$ & Total liabilities $\backslash$& stockholders' equity & $\backslash$$ & $522,433\backslash \backslash$

$\backslash$hline

$\backslash$end$\{$tabular$\}$

Using the information from the requirements above, complete the 'Analysis'.

Note: Calculate the ratios to the nearest $1$ decimal place.

Analyze the following for Freedom Fireworks:

$($a$)$ Calculate the debt to equity ratio. If the average debt to equity ratio for the industry is $1\mathrm{.}0,$ is Freedom Fireworks more or less leveraged than other companies in the same industry?

The debt to equity ratio is:

Is the company more or less leveraged than other companies?

$($b$)$ Calculate the times interest earned ratio. If the average times interest earned ratio for the industry is $20$ times, is the company more or less able to meet interest payments than other companies in the same industry? View Journal entry worksheet

$\backslash$begin$\{$tabular$\}\{|$c$|$c$|$c$|$c$|$c$|$c$|\}$

$\backslash$hline & No & Date & Account Title & Debit & Credit $\backslash \backslash$

$\backslash$hline O & $1$ & January $01$ & Cash & $103,000$ & $\backslash \backslash$

$\backslash$hline & & & Notes payable & & $103,000\backslash \backslash$

$\backslash$hline $\backslash$multirow$[$t$]\{5\}\{*\}\{,\}$ & $2$ & January $01$ & Bonds payable & $123,000$ & $\backslash \backslash$

$\backslash$hline & & & Loss on early extinguishment & $10,300$ & $\backslash \backslash$

$\backslash$hline & & & Discount on bonds payable & & $30,300\backslash \backslash$

$\backslash$hline & & & Cash & & $103,000\backslash \backslash$

$\backslash$hline & & & & & $\backslash \backslash$

$\backslash$hline $\backslash$multirow$[$t$]\{3\}\{*\}\{\backslash (\backslash$checkmark $\backslash )\}$ & $3$ & January $04$ & Cash & $31,300$ & $\backslash \backslash$

$\backslash$hline & & & Accounts receivable & & $31,300\backslash \backslash$

$\backslash$hline & & & & & $\backslash \backslash$

$\backslash$hline $\backslash$multirow$[$t$]\{3\}\{*\}\{,\}$ & $4$ & January $10$ & Accounts receivable & $14,000$ & $\backslash \backslash$

$\backslash$hline & & & Cash & & $14,000\backslash \backslash$

$\backslash$hline & & & & & $\backslash \backslash$

$\backslash$hline $\backslash$multirow$[$t$]\{3\}\{*\}\{\backslash ($