Brothers Harry and Herman Hausyerday began operations of their machine shop (H & H Tool, Incorporated) on January 1, 2020. The annual reporting period ends December 31. The trial balance on January 1, 2021, follows (the amounts are rounded to thousands of dollars to simplify): Account Titles Debit Credit Cash $ 2 Accounts Receivable 6 Supplies 13 Land o Equipment 64 Accumulated Depreciation Software 18 Accumulated Amortization Accounts Payable Notes Payable (short-term) Salaries and Wages Payable Interest Payable Income Tax Payable Common Stock Retained Earnings Service Revenue Salaries and Wages Expense Depreciation Expense Amortization Expense Income Tax Expense Interest Expense Supplies Expense Totals $ 103 $ 103 R U o0 RS~ M oo Transactions and events during 2021 (summarized in thousands of dollars) follow: . Borrowed $11 cash on March 1 using a short-term note. . Purchased land on March 2 for future building site; paid cash, $8. . Issued additional shares of common stock on April 3 for $27. . Purchased software on July 4, $11 cash. . Purchased supplies on account on October 5 for future use, $19. - Paid accounts payable on November 6, $12. . Signed a $20 service contract on November 7 to start February 1, 2022. . Recorded revenues of $168 on December 8, including $44 on credit and $124 collected in cash. . Recognized salaries and wages expense on December 9, $89 paid in cash. . Collected accounts receivable on December 10, $28. Data for adjusting journal entries as of December 31: B S3 o x . Unrecorded amortization for the year on software, $4. . Supplies counted on December 31, 2021, $12. . Depreciation for the year on the equipment, $5. . Interest of $1to accrue on notes payable. . Salaries and wages earned but not yet paid or recorded, $13. . Income tax for the year was $7. It will be paid in 2022. -------------------------- General General Income Statement or E Trial Balance Retained | Balance Sheet| Analysis Journal Ledger Statement Earnings & 0 g [] 3 2 General Journal tab - Prepare the journal entries to record the transactions (a) through (7). Review the accounts as shown in the General Ledger and Trial Balance tabs. Then prepare the necessary adjusting entries (k) through (p) to correctly report net income for the period. Then record the closing entry as of December 31. General Ledger tab - Each journal entry is posted automatically to the general ledger. Use the drop-down button to view the unadjusted, adjusted, or post-closing balances in the General Ledger. Trial Balance tab - You may view either the unadjusted, adjusted, or post-closing trial balance by choosing from the drop- down. Income Statement tab - Use the drop-down to select the accounts properly included on the income statement. The unadjusted, adjusted, or post-closing balances will appear for each account based on your selection. Statement of Retained Earnings tab - Prepare the statement of retained earnings for the year ended December 31, 2021. Balance Sheet tab - Use the drop-down to select the accounts to properly included on the balance sheet. The unadjusted, adjusted, or post-closing balances will appear for each account, based on your selection. Analysis tab - Calculate the Net Profit Margin and Current Ratio. 17 December 31, 202 Service Revenue 168 Salaries and Wages Expense 89 X Supplies Expense 20 V Depreciation Expense 5 Amortization Expense 4V Interest Expense 1 V Income Tax Expense 7 Retained Earnings 9 X. Statement of Retained Balance Sheet Analysis Earnings General General . Income Journal Ledger RIS Statement Requirement Choose the appropriate accounts to be reported on the income statement. Select the 'adjusted' from the dropdown, which will then populate the balances in those accounts from the trial balance. Adjusted v General Statement of Requirement General Journal Ledger Trial Balance Income Retained Statement Balance Sheet Analysis Earnings Prepare the statement of retained earnings for the year ended December 31, 2021. You will need to determine and enter the accounts and balances to prepare the Statement of Retained Earnings. Adjusted H & H TOOL, INCORPORATED Statement of Retained Earnings For the Year Ended December 31, 2021 (in thousands) Balance, January 1, 2021 0 Balance, December 31, 2021 $ 0Statement of Requirement General General Income Trial Balance Retained Analysis Journal Ledger Statement Balance Sheet Earnings Use the dropdowns to select the accounts properly included on the classified balance sheet. The unadjusted, adjusted, or post-closing balances will appear for each account, based on your selection. Adjusted H & H TOOL, INCORPORATED Balance Sheet At December 31, 2021 (in thousands) EA O O O o O O O o O O O O 0 Equipment 64 $ O 0 64 O Software 29 0 0 29 $ 93 EA 0Statement of General General Trial Balance Income Requirement Retained Journal Ledger Statement Balance Sheet Analysis Earnings Calculate the Net Income, Net Profit Margin and Current Ratio. Net income can be found on Income statement tab. (Hint : Select Adjusted on the dropdown.) How much net income did H & H Tool, Incorporated, generate during 2021? What was its net profit margin? (Round "Net Profit Margin" to 1 decimal place.) Net income Net Profit Margin % Is the company financed primarily by liabilities or stockholders' equity? What is its current ratio? (Round your answer to 2 decimal places.) Current Ratio