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MNO Corp. reports the following balances on February 28, 2025: Account Amount Cash $21,000 Accounts Receivable $13,000 Inventory $24,000 Prepaid Insurance $2,900 Machinery $55,000 Accumulated
MNO Corp. reports the following balances on February 28, 2025:
Account | Amount |
Cash | $21,000 |
Accounts Receivable | $13,000 |
Inventory | $24,000 |
Prepaid Insurance | $2,900 |
Machinery | $55,000 |
Accumulated Depreciation | $11,000 |
Accounts Payable | $17,000 |
Short-Term Loans | $6,000 |
Bonds Payable | $22,000 |
Common Stock | $45,000 |
Retained Earnings | $14,900 |
Requirements:
- Draft a balance sheet with current and non-current classifications.
- Calculate the quick ratio and debt-to-equity ratio.
- Analyze the financial leverage and liquidity of MNO Corp.
- Prepare adjusting entries for:
- Depreciation expense: $5,500
- Insurance expense: $1,450
- Explain the impact of not making adjusting entries on the balance sheet and income statement.
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