The adjusted trial balance for the year of Scneider Corporation at December 31, 2016, follows:

Requirements
1. Prepare Schneider Corporation's 2016 single-step income statement, statement of retained earnings, and balance sheet. List expenses (except for income tax) in decreasing order on the income statement, and show total liabilities on the balance sheet.
2. Schneider's lenders require that the company maintain a debt ratio no higher than 0.50. Compute Schneider's debt ratio at December 31, 2016, to determine whether the company is in compliance with this debt restriction. If not, suggest a way Schneider Corporation could have avoided this difficult situation.

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Schneider Corporation Adjusted Trial Balance December 31, 2016 Debit Account Cash Accounts receivable Supplies Prepaid rent Equipment Accumulated depreciation-equipment Accounts payable nterest payable Unearned service revenue Income tax payable Note payable Common stock Retained earnings Dividends Service revenue Depreciation expense-equipment Salary expense Rent expense Interest expense Insurance expense Supplies expense Income tax expense Total Credit 12.400 19,500 2,300 1,200 S 4,100 8,700 800 800 2,200 18,500 16,000 3,000 5,000 91,500 1,700 39,800 10,400 3,500 3,800 2,700 7300 145,600 $ 145,600