The adjusted trial balance for Tybalt Construction as of December 31, 2015, foll

Question

The adjusted trial balance for Tybalt Construction as of December 31, 2015, follows.

   

  

  

Prepare the income statement for the calendar year 2015.

Prepare the statement of owner's equity for the calendar year 2015.

Prepare the classified balance sheet at December 31, 2015.

Closing entries (all dated December 31, 2015):

Use the information in the financial statements to compute the following ratios:

      Denominator:=Return on total assets/=Return on total assets 0 (b) Debt ratioNumerator:/Denominator:=Debt ratio/=Debt ratio 0 (c) Profit margin ratio (use total revenues as the denominator)Numerator:/Denominator:=Profit margin/=Profit margin 0%(d) Current ratioNumerator:/Denominator:=Current ratio/=Current ratio 0

The adjusted trial balance for Tybalt Construction as of December 31, 2015, follows.

Explanation / Answer

Part 1 - Income Statement

Tybalt Construction

Income Statement

For the year ended December 31, 2015

Part 2 - Statement of owners equity

Tybalt construction

Statement of owners equity

For the year ended December 2015

Part 3 - Balance sheet

Tybalt construction

Balance sheet

As on december 31, 2015

Part 4 - Closing Journal Entries for December 2015

Part 5 - Calculation of ratios

Return on assets (Net income/Average total assets)

Assuming opening balance of assets = $200000

Closing balance = $218100

Average = ($200000+$218100)/2 = $209050

2.06%

($4300/$209050)

0.46

($100400/$218100)

3.74%

($4300/$115100)

1.07

($43100/$40400)

Particulars Amount Revenue Professional Fees earned $97000 Rent Earned $14000 Dividend earned $2000 Interest earned $2100 Total Revenue (A) $115100 Expenses Depreciation expenses - Building $11000 Depreciation expenses - Equipment $6000 Wages expenses $32000 Interest expenses $5100 Insurance expenses $10000 Rent expenses $13400 Supplies expenses $7400 Postage expenses $4200 Property taxes expenses $5000 Repairs expenses $8900 Telephone expenses $3200 Utilities expenses $4600 Total Expenses (B) $110800 Net Income (A - B) $4300

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