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.