P10-82A. (Learning Objectives 3, 6: Preparing a corporation’s Balance Sheet; measuring profitability) The following accounts and related balances of Pelican Designers, Inc., as of December 31, 20X6, are arranged in no particular order.

Requirements 1. Prepare Pelican’s classified Balance Sheet in the account format at December 31, 20X6.
2. Compute rate of return on ordinary shareholders’ equity for the year ended December 31, 20X6.
3. Does the ROE suggest strength or weakness? Give your reason.

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Cash. $55,000 Interest expense.... $ 15,600 Accounts receivable, net. 34,000 Property, plant and Paid-in capital in excess equipment, net 364,000 of par ordinary.. 20,000 Ordinary share, $2 par, Accrued liabilities.... 24,000 600,000 shares authorized, Long-term note payable. 99,000 116,000 shares issued............... 232,000 Inventory... 93,000 Prepaid expenses. 13,000 Dividends payable. 6,000 Ordinary shareholders' Retained earnings... ? equity, December 31, 20X6..... 222,000 Accounts payable. 136,000 Net income...... 32,000 Trademarks, net. 4,000 Total assets, Preference share, $0.50, December 31, 20X6 493,000 no-par, 11,000 shares Treasury share, authorized and issued. 29,700 21,000 shares at cost 24,000 Goodwill........... 13,000