please check this for me$,$ I need all the points allowed for a high mark. How much profit did Classic Upholstery Shop, Inc. make in its first year of business?

Do you think it was a good idea for Tyler to open the upholstery shop or would he have been better off with his old job and why? Please include the financial data in your answer that helped you reach this conclusion.

Calculate Tyler$$s working capital. Show your work and your answer.

Does Tyler$$s working capital indicate he is managing his cash well? Why or why not?

Do Tyler$$s assets exceed his liabilities? Please show your work. Is this an indication of a favorable or unfavorable financial situation and why?

Is Classic Upholstery Shop considered solvent? Why or why not? Choose at least one of the solvency ratios found in Chapter $14$ and use it to explain your answer.

What advice would you give Tyler going into his second year of operations?

Classic Upholstery Shop

Balance Sheet

December $31,2022$

Assets:

Cash $$37,550\mathrm{.}00$ $$65,950\mathrm{.}0056\mathrm{.}94\%$

Accounts Receivable $$9,000\mathrm{.}00$ $$(10,350\mathrm{.}00)$

Inventory $$17,800\mathrm{.}00$ $$55,600\mathrm{.}00$

Prepaid Insurance $$1,600\mathrm{.}00$

Fixed Assets:

Equipment $$5,000\mathrm{.}00$

Other Equipment $$15,000\mathrm{.}00$

Vehicle $$14,000\mathrm{.}00$

Less: Accumulated Depreciation $$(8,000\mathrm{.}00)$

Net Fixed Assets $$26,000\mathrm{.}00$

Total Assets $$91,950\mathrm{.}0081600$

Liabilities:

Accounts Payable $$750\mathrm{.}00$

Loan Payable $$9,600\mathrm{.}00$

Total Liabilities $$10,350\mathrm{.}0012\mathrm{.}68\%$

Stockholder's Equity:

Common Stock $$50,000\mathrm{.}00$

Retained Earnings $$31,600\mathrm{.}00$

Total Stockholders' Equity $$81,600\mathrm{.}00$

Total Liabilities and Stockholders' Equity $$91,950\mathrm{.}00$

Classic Upholstery Shop

Statement of Stockholders' Equity

For the Year Ended December $31,2022$

Common Stock Retained Earnings Total

Beginning Balances, January $1,2022$ $$-$ $$-$ $$-$

Add: Common Stock Issued $$50,000\mathrm{.}00$ $$-$ $$50,000\mathrm{.}00$

Add: Net Income $$-$ $$31,600\mathrm{.}00$ $$31,600\mathrm{.}00$

Less: Dividends $$-$ $$-$ $$-$

Ending Balances, December $31,2022$ $$50,000\mathrm{.}00$ $$31,600\mathrm{.}00$ $$81,600\mathrm{.}00$

Classic Upholstery Shop

Income Statement

For the Year Ended December $31,2022$

Fees Earned $$111,000\mathrm{.}00$

Expenses:

Fabric Expense $$34,000\mathrm{.}00$

Advertising Expense $$11,000\mathrm{.}00$

Wages Expense $$8,450\mathrm{.}00$

Supplies Expense $$8,200\mathrm{.}00$

Depreciation Expense $$8,000\mathrm{.}00$

Rent Expense $$4,900\mathrm{.}00$

Utilities Expense $$1,950\mathrm{.}00$

Insurance Expense $$1,600\mathrm{.}00$

Professional Expense $$800\mathrm{.}00$

Interest Expense $$500\mathrm{.}00$

Total expenses $$79,400\mathrm{.}00$

Net Income $$31,600\mathrm{.}0028\mathrm{.}47\%$

Adjusted Trial Balance

$12/31/2022$

DR CR

Cash $$37,550\mathrm{.}00$

Accounts Receivable $$9,000\mathrm{.}00$

Fabric Inventory $$16,000\mathrm{.}00$

Supplies Inventory $$1,800\mathrm{.}00$

Prepaid Insurance $$1,600\mathrm{.}00$

Equipment $-$ sewing machines $$5,000\mathrm{.}00$

Accumulated depreciation $-$ sewing machines $$1,000\mathrm{.}00$

Other equipment $$15,000\mathrm{.}00$

Accumulated depreciation $-$ other equipment $$5,000\mathrm{.}00$

Vehicle $$14,000\mathrm{.}00$

Accumulated depreciation $-$ Vehicle $$2,000\mathrm{.}00$

Accounts Payable $$750\mathrm{.}00$

Loan Payable $$9,600\mathrm{.}00$

Common Stock $$50,000\mathrm{.}00$

Fees Earned $$111,000\mathrm{.}00$

Wages Expense $$8,450\mathrm{.}00$

Rent Expense $$4,900\mathrm{.}00$

Utilities Expense $$1,950\mathrm{.}00$

Professional Expense $$800\mathrm{.}00$

Advertising Expense $$11,000\mathrm{.}00$

Fabric Expense $$34,000\mathrm{.}00$

Supplies Expense $$8,200\mathrm{.}00$

Insurance Expense $$1,600\mathrm{.}00$

Depreciation Expense $$8,000\mathrm{.}00$

Interest Expense $$500\mathrm{.}00$

$$179,350\mathrm{.}00$ $$179,350\mathrm{.}00$