Question: Tech Solutions Ltd provided the following balance sheet information as of 31 December 2021: Cash: 20,000 Accounts Receivable: 30,000 Inventory: 50,000 Property, Plant, and Equipment

Tech Solutions Ltd provided the following balance sheet information as of 31 December 2021:

  • Cash: £20,000
  • Accounts Receivable: £30,000
  • Inventory: £50,000
  • Property, Plant, and Equipment (net): £100,000
  • Accounts Payable: £25,000
  • Short-term Debt: £15,000
  • Long-term Debt: £50,000
  • Common Stock: £80,000
  • Retained Earnings: £30,000

Requirements:

  1. Prepare a classified balance sheet as of 31 December 2021.
  2. Calculate the current ratio and debt-to-equity ratio.
  3. Analyze the liquidity and financial stability of Tech Solutions Ltd based on the calculated ratios.

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