Selected accounts of Elevator Service Company, at December 31, 2008, follow.

Requirements 

1. Prepare the company's classified balance sheet in report form at December 31, 2008. Show totals for total assets, total liabilities, and owner's equity.

2. Compute the company's current ratio and debt ratio at December 31, 2008. At December 31, 2007, the current ratio was 1.30 and the debt ratio was 0.55 . Did the company's ability to pay debts improve, deteriorate, or remain the same during 2008?

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Insurance expense $ 600 Accounts payable $34,700 Note payable, long-term 3,200 Accounts receivable 42,100 Other assets 2,300 Accumulated depreciation- Building 55,900 building 47,300 Prepaid rent 4,700 Accumulated depreciation- Salary expense 17,800 equipment 7,700 Salary payable 3,500 Cash 12,000 Service revenue 71,100 Depreciation expense 1,900 Supplies 3,800 Leah Jacobs, capital 46,900 Unearned service revenue 1,700 Equipment 24,200