Question

Problem 3-8A Preparing closing entries, financial statements, and ratios LO A1, A2, P3, P4

The adjusted trial balance for Tybalt Construction as of December 31, 2017, follows.

TYBALT CONSTRUCTION Adjusted Trial Balance December 31, 2017
No.	Account Title	Debit				Credit
101	Cash	$	5,000
104	Short-term investments		23,500
126	Supplies		9,900
128	Prepaid insurance		8,000
167	Equipment		60,000
168	Accumulated depreciation—Equipment					$	30,000
173	Building		165,000
174	Accumulated depreciation—Building						55,000
183	Land		63,100
201	Accounts payable						16,000
203	Interest payable						2,600
208	Rent payable						3,300
210	Wages payable						2,900
213	Property taxes payable						1,500
233	Unearned professional fees						7,500
251	Long-term notes payable						71,000
307	Common stock						5,000
318	Retained earnings						125,600
319	Dividends		12,500
401	Professional fees earned						99,000
406	Rent earned						17,500
407	Dividends earned						2,900
409	Interest earned						2,900
606	Depreciation expense—Building		12,100
612	Depreciation expense—Equipment		9,000
623	Wages expense		26,500
633	Interest expense		4,700
637	Insurance expense		8,300
640	Rent expense		10,200
652	Supplies expense		5,300
682	Postage expense		4,000
683	Property taxes expense		3,100
684	Repairs expense		6,900
688	Telephone expense		2,500
690	Utilities expense		3,100
	Totals	$	442,700			$	442,700

The December 31, 2016, credit balance of the Retained Earnings account was $125,600. Tybalt Construction is required to make a $8,500 payment on its long-term notes payable during 2018.

Required:
1a. Prepare the income statement for the calendar-year 2017.
1b. Prepare the statement of retained earnings for the calendar-year 2017.
1c. Prepare the classified balance sheet at December 31, 2017.
2. Prepare the necessary closing entries at December 31, 2017.
3. Use the information in the financial statements to compute the following ratios (note: round your answers to 2 decimal points; for example: 10.469 rounds to 10.47)
  

Answer 1