Gildan Activewear Inc. specializes in manufacturing and selling T-shirts, sport shirts, and fleece. The following is adapted from a recent statement of financial position (assume that the fiscal year ends on December 31, 2008). Dollars are in thousands.

Assume that the following transactions occurred in the first quarter ended March 31, 2009:

a. Received \(\$ 630\) on sale of intangibles.

b. Paid \(\$ 12,340\) in principal on long-term debt.

c. Purchased \(\$ 3,400\) in non-current investments for cash.

d. Sold equipment at its cost for \(\$ 4,020\) cash.

e. Purchased additional intangibles for \(\$ 2,980\) cash.

f. Issued additional shares for \(\$ 1,020\) in cash.
g. Purchased property, plant, and equipment; paid \(\$ 1,830\) in cash and \(\$ 9,400\) with additional long-term bank loans.
h. Sold other assets at cost for \(\$ 310\) cash.
i. Declared and paid \(\$ 300\) in dividends to shareholders.
Required:
1) Create T-accounts for each of the accounts on the statement of financial position; enter the balances at December 31, 2008.
2) Record each of the transactions for the first quarter ended March 31, 2009, in the T-accounts (including referencing) and determine the ending balances.
3) Prepare a classified statement of financial position at March 31, 2009.
4) Compute the debt-to-equity ratio at March 31, 2009. What does this suggest about Gildan Activewear?

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Cash and cash equivalents $12,357 Accounts payable and accrued liabilities $155,669 Accounts receivable 222,158 Other current liabilities 50,183 Inventories 316,172 Long-term debt 49,448 Prepaid expenses and other current assets 10,413 Other long-term liabilities 34,493 Property, plant, and equipment, net 436,516 Share capital 89,377 Intangible assets 59,954 Retained earnings 689,980 Other assets 44,556 Other components of equity 32,976