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 Table Summary H H Tool Inc Trial Balance on Jan 1, 2020 shows debit balances for Assets with the exception of Accumulated Depreciation with a credit balance credit balances for Stockholders' Equity, and Revenue accounts Debits equal credits Balances are missing for all liabilities, revenues, and expenses H H TOOL, INC Trial Balance on January 1, 2020 Debit Credit Cash 6,000 Accounts receivable 5,000 Supplies 13,000 Land Equipment 78,000 Accumulated depreciation (on equipment) 8,000 Other noncurrent assets (not detailed to simplify) 7,000 Accounts payable Wages payable Interest payable Dividends payable Income taxes payable Long term notes payable Common stock (8,000 shares, $0 50 par value) 4,000 Additional paid in capital 80,000 Retained earnings 17,000 Service revenue Depreciation expense Supplies expense Wages expense Interest expense Income tax expense Miscellaneous expenses (not detailed to simplify) Totals 109,000 109,000 Page 225 Transactions during 2020 follow Borrowed $15,000 cash on a five year, 8 percent note payable, dated March 1, 2020 Purchased land for a future building site paid cash, $13,000 Earned $215,000 in revenues for 2020, including $52,000 on credit and the rest in cash Sold 4,000 additional shares of capital stock for cash at $1 market value per share on January 1, 2020 Incurred $89,000 in wages expense and $25,000 in Miscellaneous expenses for 2020, with $20,000 on credit and the rest paid in cash Collected accounts receivable, $34,000 Purchased other assets, $15,000 cash Purchased supplies on account for future use, $27,000 Paid accounts payable, $26,000 Signed a three year $33,000 service contract to start February 1, 2021 Declared cash dividends on December 1, $25,000, which were paid by December 31 Hint Prepare two entries Data for adjusting entries Supplies counted on December 31, 2020, $18,000 Depreciation for the year on the equipment, $10,000 Interest accrued on notes payable (to be computed) Wages earned by employees since the December 24 payroll but not yet paid, $16,000 Income tax expense, $11,000, payable in 2021 Required Set up T accounts for the accounts on the trial balance and enter beginning balances Prepare journal entries for transactions ( a ) through ( k ) and post them to the T accounts Journalize and post the adjusting entries ( l ) through ( p ) Prepare an income statement (including earnings per share rounded to two decimal places), statement of stockholders equity, and balance sheet Identify the type of transaction for ( a ) through ( k ) for the statement of cash flows (O for operating, I for investing, F for financing) and the direction and amount of the effect Journalize and post the closing entry Compute the following ratios (rounded to two decimal places) for 2020 and explain what the results suggest about the company Current ratio Total asset turnover Net profit margin

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Brothers Mike and Tim Hargenrater began operations of their tool and die shop (H & H Tool, Inc.) on January 1, 2019. The annual reporting

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:

Table Summary: H & H Tool Inc.Trial Balance on Jan. 1, 2020 shows debit balances for Assets with the exception of Accumulated Depreciation with a credit balance; credit balances for Stockholders' Equity, and Revenue accounts. Debits equal credits. Balances are missing for all liabilities, revenues, and expenses.

H & H TOOL, INC. Trial Balance on January 1, 2020 Debit Credit Cash 6,000 Accounts receivable 5,000 Supplies 13,000 Land Equipment 78,000 Accumulated depreciation (on equipment) 8,000 Other noncurrent assets (not detailed to simplify) 7,000 Accounts payable Wages payable Interest payable Dividends payable Income taxes payable Long-term notes payable Common stock (8,000 shares, $0.50 par value) 4,000 Additional paid-in capital 80,000 Retained earnings 17,000 Service revenue Depreciation expense Supplies expense Wages expense Interest expense Income tax expense Miscellaneous expenses (not detailed to simplify) Totals 109,000 109,000

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Transactions during 2020 follow:

Borrowed $15,000 cash on a five-year, 8 percent note payable, dated March 1, 2020.
Purchased land for a future building site; paid cash, $13,000.
Earned $215,000 in revenues for 2020, including $52,000 on credit and the rest in cash.
Sold 4,000 additional shares of capital stock for cash at $1 market value per share on January 1, 2020.
Incurred $89,000 in wages expense and $25,000 in Miscellaneous expenses for 2020, with $20,000 on credit and the rest paid in cash.
Collected accounts receivable, $34,000.
Purchased other assets, $15,000 cash.
Purchased supplies on account for future use, $27,000.
Paid accounts payable, $26,000.
Signed a three-year $33,000 service contract to start February 1, 2021.
Declared cash dividends on December 1, $25,000, which were paid by December 31. [Hint: Prepare two entries.]

Data for adjusting entries:

Supplies counted on December 31, 2020, $18,000.
Depreciation for the year on the equipment, $10,000.
Interest accrued on notes payable (to be computed).
Wages earned by employees since the December 24 payroll but not yet paid, $16,000.
Income tax expense, $11,000, payable in 2021.

Required:

Set up T-accounts for the accounts on the trial balance and enter beginning balances.
Prepare journal entries for transactions (a) through (k) and post them to the T-accounts.
Journalize and post the adjusting entries (l) through (p).
Prepare an income statement (including earnings per share rounded to two decimal places), statement of stockholders equity, and balance sheet.
Identify the type of transaction for (a) through (k) for the statement of cash flows (O for operating, I for investing, F for financing) and the direction and amount of the effect.
Journalize and post the closing entry.
Compute the following ratios (rounded to two decimal places) for 2020 and explain what the results suggest about the company:
1. Current ratio
2. Total asset turnover
3. Net profit margin