Drake company reported the following for 2014:

Current Assets: $87,000

Current Liabilities: 19,000

Revenues: 450,000

Cost of goods sold: 220,000

Non current assets: 186,000

Bonds payable (10% at issued par) 100,000

Perferred Stock ($5, $100 par) 20,000

Common Stock, $10 par: 50,000

paid in capital in excess of par: 48,000

Operating expenses: 64,000

Retained earnings: 36,000

A. Ignoring income taxes, prepare an income statement and balance sheet for Drake company at December 31, 2014, that is consistent with each of the following theories of equity:

1. Entity theory

2. Proprietary theory

3. Residual equity theory

B. For each theory above, compute the December 31, 2014 debt to equity ration. If none would be computed, discuss why.