Brothers Mike and Tim Hargenrater began operations of their tool and die shop (H & H Tool, Inc.) on January 1, 2019. The annual reporting period ends December 31. The trial balance on January 1, 2020, follows: H & H Tool, Inc. Trial Balance on January 1, 2020 Account Titles Debit Credit Cash 5,000 Accounts receivable 4,000 Supplies 19,000 Land Equipment 86,000 Accumulated depreciation (on equipment) 16,000 Other noncurrent assets (not detailed to simplify) 8,000 Accounts payable Wages payable Interest payable Dividends payable Income taxes payable Long-term notes payable Common stock (8,000 shares, $.50 par value) 4,000 Additional paid-in capital 88,000 Retained earnings 14,000 Service revenue Supplies expense Wages expense Depreciation expense Interest expense Income tax expense Miscellaneous expenses (not detailed to simplify) Totals 122,000 122,000 Transactions during 2020 follow: a. Borrowed $20,000 cash on a 5-year, 6 percent note payable, dated March 1, 2020. b. Purchased land for a future building site on March 15, 2020; paid cash, $19,000. c. Earned $279,000 in revenue. Transactions dated August 30, 2020, including $57,000 on credit and the rest in cash. d. Sold 6,000 additional shares of capital stock for cash at $1 market value per share on January 1, 2020. e. Incurred $96,000 in wages expense and $33,000 in miscellaneous expenses for 2020, with $28,000 on credit and the rest paid in cash. f. Collected accounts receivables on November 10, 2020, $32,000. g. Purchased other assets on November 15, 2020, $19,000 cash. h. Purchased supplies on account for future use on December 1, 2020, $31,000. Paid accounts payable on December 15, 2020, $29,000. j. Signed a three-year $37,000 service contract on December 17, 2020 to start February 1, 2021. k. Declared cash dividends on December 1, 2020, $29,000, which were paid by December 31. Data for adjusting entries: 1. Supplies counted on December 31, 2020, $22,000. m. Depreciation for the year on the equipment, $18,000. n. Interest accrued on notes payable (to be computed). o. Wages earned by employees since the December 24 payroll but not yet paid, $21,000. p. Income tax expense, $17,000, payable in 2021. Analyze Cash Flow Impact: Transaction Type of Effect on Direction and Amount of Effect Cash Flows 1 2 3. 4 5. 6. Balance, January 1, 2020 Add: Additional stock issuance Add: Net income Less: Dividends declared Balance, December 31, 2020 Current assets: H&H TOOL, INC. Statement of Stockholders' Equity For the Year Ended December 31, 2020 Common Stock Assets Total current assets Property, plant and equipment: Net property, plant and equipment Total assets Additional Paid-in Capital Retained Earnings Total Stockholders' Equity H&H TOOL, INC. Balance Sheet At December 31, 2020 Lia Current liabilities. Total current liabilitie Total liabilities Stockho Total stockholders equity Total liabilities and stocks a. Compute the current ratio for 2020. Current ratio b. Compute the total asset turnover ratio for 2020. Total asset turnover. c. Compute the net profit margin ratio for 2020. Net profit margin % H & H Tool, Inc. I ADJUSTED Trial Balance (to be used to create the financial statements) December 31, 2020 Account Title Debit Credit Cash 88,000 Accounts receivable 29,000 Supplies 22,000 Land 19,000 Equipment 86,000 Accumulated depreciation-equipment 34,000 Other assets 27,000 Accounts payable 30,000 Interest payable 1,000 Wages payable 21,000 Income taxes payable 17,000 Long-term notes payable 20,000 Common stock Additional paid-in capital 7,000 91,000 Retained earnings 15,000 Service revenue 279,000 Depreciation expense 18,000 Interest expense 1,000 Wanes expense 117.000 100% Total asset turnover c. Compute the net profit margin ratio for 2020. Net profit margin % H & H Tool, Inc. ADJUSTED Trial Balance (to be used to create the financial statements) December 31, 2020 Credit Account Title Debit 88,000 Cash Accounts receivable 29,000 22,000 Supplies Land 19,000 Equipment 86,000 Accumulated depreciation-equipment 34,000 Other assets 27,000 Accounts payable 30,000 Interest payable 1,000 Wages payable 21,000 Income taxes payable 17,000 Long-term notes payable 20,000 Common stock 7,000 Additional paid-in capital 91,000 Retained earnings 15,000 Service revenue 279,000 Depreciation expense 18,000 Interest expense 1,000 Wages expense 117,000 Supplies expense 28,000 Income tax expense 17,000 Miscellaneous expenses 33,000 Total 500,000 500,000