The adjusted trial balance for Wootton Bowling Alley at December 31, 2012, contains the following accounts.
|
Debits |
Credits |
||
|
Buildings |
$128,800 |
Owner’s Capital |
$115,000 |
|
Accounts Receivable |
14,520 |
Accumulated Depreciation—Buildings |
42,600 |
|
Prepaid Insurance |
4,680 |
Accounts Payable |
12,300 |
|
Cash |
18,040 |
Notes Payable |
97,780 |
|
Equipment |
62,400 |
Accumulated Depreciation—Equipment |
18,720 |
|
Land |
67,000 |
Interest Payable |
2,600 |
|
Insurance Expense |
780 |
Service Revenue |
17,180 |
|
Depreciation Expense |
7,360 |
$306,180 |
|
|
Interest Expense |
2,600 |
||
|
$306,180 |
Instructions
(a) Prepare a classified balance sheet; assume that $22,000 of the note payable will be paid in 2013.
(b) Comment on the liquidity of the company.