The following accounts and December 31, 2006, balances of New York Optical Corporation are arranged in no particular order.

Requirements 

1. Prepare the company's classified balance sheet in account format at December 31, 2006.

2. Compute New York Optical's rate of return on total assets and rate of return on common stockholders' equity for the year ended December 31, 2006. For the rates of return, you will need these data:

3. Do these rates of return suggest strength or weakness? Give your reason. 

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Retained earnings $145,000 Common stock, $5 par Inventory 101,000 100,000 shares authorized, Property, plant, and 22,000 shares issued $110,000 equipment, net 278,000 Dividends payable 3,000 Prepaid expenses 13,000 Paid-in capital in excess Goodwill 63,000 of par-common 140,000 Accrued liabilities payable 17,000 Accounts payable 31,000 Long-term note payable 104,000 Preferred stock, 4%, $10, no-par Accounts receivable, net 102,000 25,000 shares authorized, Cash 43,000 5,000 shares issued 50,000