5. Given below are the balance sheets for Leo Company and Capricorn Company. A. Convert the two balance sheets into common-size form. B. Examine the financial positions shown by these balance sheets and discuss the positive and negative aspects of each company's position. BALANCE SHEETS DECEMBER 31,20 Leo Company Capricorn Company $ 31 000 Assets Bank Accounts Receivable Plant and Equipment Automobiles Total Assets $ 1 000 25 000 150 000 50 000 $226 000 160 000 29 000 $220 000 $ 25 000 20 000 Liabilities and Equity Accounts Payable Loan Payable-Automobile Mortgage Payable Owner's Equity Total Liabilities and Equity $ 11 000 20 000 150 000 39 000 $220 000 181 000 $226 000 ANSWERS TO SECTION 8.3 EXERCISES (cont.) Exercise 5, p. 278 Balance Sheets December 31, 20- Leo Company Capricorn Company Items Assets $ Bank $ 31 000 1 000 Accounts Receivable 1 25 000 Plant and Equipment 150 000 Automobiles 50 000 160 000 29 000 $220 000 Total Assets $226 000 Liabilities and Equity $ 25000 Accounts Payable Loan Payable-Automobile Mortgage Payable 20 000 $ 11 000 20 000 150 000 30 000 $220 000 Owner's Equity 181 000 Total Liabilities and Equity $226 000 2 Pear Bucation Canada Ine Toronto Catania