Affordable Lawn Care, Incorporated, provides lawn$-$mowing services to both commercial and residential customers. The company performs adjusting entries on a monthly basis, whereas closing entries are prepared annually at December $31.$ An adjusted trial balance dated December $31,$ current year, follows:

AFFORDABLE LAWN CARE, INCORPORATED

Adjusted Trial Balance

December $31,$ Current Year

Debits Credits

Cash $ $117,050$

Accounts receivable $9,600$

Prepaid insurance $16,000$

Prepaid rent $6,000$

Supplies $2,150$

Trucks $300,000$

Accumulated depreciation: trucks $ $240,000$

Mowing equipment $40,000$

Accumulated depreciation: mowing equipment $24,000$

Accounts payable $3,000$

Notes payable $100,000$

Salaries payable $1,800$

Interest payable $300$

Income taxes payable $2,100$

Unearned mowing revenue $1,800$

Capital stock $40,000$

Retained earnings $60,000$

Dividends $10,000$

Mowing revenue earned $340,000$

Insurance expense $4,800$

Office rent expense $72,000$

Supplies expense $10,400$

Salary expense $120,000$

Depreciation expense: trucks $60,000$

Depreciation expense: mowing equipment $8,000$

Repair and maintenance expense $6,000$

Fuel expense $3,000$

Miscellaneous expense $10,000$

Interest expense $6,000$

Income taxes expense $12,000$

$ $813,000$ $ $813,000$

Required: Using the financial statements prepared in part a$,$ briefly evaluate the company's profitability and liquidity.