The accounting records of Router Wireless include the following as of December 3

Question

The accounting records of Router Wireless include the following as of December 31, 2018:

Requirements

1.) Report these liabilities on the Router Wireless balance sheet, including headings and totals for current liabilities and long-term liabilities.

2.) Compute Router Wireless's debt to equity ration at December 31, 2018

Accounts Payable Mortgages Payable (long-term) Interest Payable Bonds Payable (long-term) Total Stockholders' Equity 76,000 Salaries Payable 72,000 Bonds Payable (current portion) 17,000 Premium on Bonds Payable 56,000 Unearned Revenue (short-term) 155,000 $ 10,000 25,000 12,000 2,400

Explanation / Answer

1) PARTIAL BALANCE SHEET

Note : - stakeholder's equity is not a part of liability . it is shown separately.

2) Debt to equity ratio = Total debt / equity

= 268000/ 155000 = 1.729

Particulars Amount Amount Current Liab Accounts payable 76000 Interest payable 17000 Salaries payable 10000 Bond payable ( current portion) 25000 Premium on bond payable 12000 140000 Unearned revenue 2400 Long term liab Mortgage payable 72000 Bond payable 56000 128000 TOTAL LIAB 268000

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