The adjusted trial balance for Tybalt Construction as of December 31, 2013, follows.

O. Tybalt invested $5,000 cash in the business during year 2013 (the December 31, 2012, credit balance of the O. Tybalt, Capital account was $121,400). Tybalt Construction is required to make a $7,000 payment on its long-term notes payable during 2014.

Required

1. Prepare the income statement and the statement of owner’s equity for the calendar year 2013 and the classified balance sheet at December 31, 2013.

2. Prepare the necessary closing entries at December 31, 2013.

3. Use the information in the financial statements to compute these ratios:

(a) Return on assets (total assets at December 31, 2012, was $200,000),

(b) Debt ratio,

(c) Profit margin ratio (use total revenues as the denominator), and

(d) Current ratio. Round ratios to three decimals for parts a and c, and to two decimals for parts b and d.

Transcribed Image Text:

401 Professional fees earned 97,000 14,000 2,000 2,100 407 Dividends earned.. 409 Interest earned···· 606 Depreciation expense Building 612 Depreciation expens quipment. 623 Wages expense 633 Interest expense... 637 Insurance expense 640 Rent expense 652 Supplies expense 682 Postage expense 683 Property taxes expense .. 684 Repairs expense... 688 Telephone expense 690 Utilities expense... 1,000 6,000 32,000 5,100 0,000 13,400 7,400 4,200 5,000 8,900 3,200 4,600 $411,900 $411,900