Reference no: EM133183343
Question - Accounts from Max Company's 12/31/19 adjusted pre-closing trial balance for the 2019 fiscal year appear below:
Balance
Sales Revenue 197,000
Property, Plant & Equipment 115,300
Cost of Goods Sold 97,000
Inventory 41,500
Notes Payable (due 12/31/23) 41,000
Salaries and Wage Expense 38,900
Common Stock 35,000
Accumulated Depreciation - Equipment 33,000
Retained Earnings (beginning balance) 31,000
Accounts Receivable 22,000
Rent Expense 14,100
Accounts Payable 8,500
Cash 8,000
Prepaid Insurance 5,650
Salaries Payable 3,700
Interest Expense 3,250
Allowance for Doubtful Accounts 2,500
Depreciation Expense 2,400
Insurance Expense 2,300
Bad Debt Expense 1,300
First classify the accounts above (asset, liability, equity, revenue, expense). Then calculate 2019 net income and determine the ending balance of retained earnings. Finally prepare a classified balance sheet (current vs long term) using the information above. Using balance sheet, answer the questions below.
1. What is the total amount reported as Current Assets as of 12/31/19?
2. What is the total amount reported as Total Liabilities as of 12/31/19?
3. What is the total amount report as Total Stockholders' Equity as of 12/31/19?
4. Calculate the Debt to Equity ratio as of 12/31/19 and briefly discuss what this means.
5. Calculate the Current Ratio as of 12/31/19 and briefly discuss what this means.