ABC Ltd. Year-End Balances as of March 31, 2024:

Item	Amount
Cash	$9,500
Accounts Receivable	$11,000
Supplies	$3,500
Prepaid Insurance	$1,500
Machinery	$50,000
Accumulated Depreciation	$8,000
Accounts Payable	$12,000
Wages Payable	$2,000
Common Stock	$30,000
Retained Earnings	$23,000

Requirements:

1. Create a classified balance sheet.
2. Determine the current ratio and working capital.
3. Assess the financial health of ABC Ltd.
4. Record the adjusting entries for:
   • Depreciation expense for the year: $4,000
   • Supplies expense for the year: $1,000
5. Discuss why adjusting entries are crucial for accurate financial reporting.