PQR Ltd. recorded the following balances on September 30, 2024:

• Cash: $16,000
• Accounts Receivable: $13,000
• Prepaid Rent: $2,400
• Accounts Payable: $6,500
• Interest Payable: $1,700
• Equipment: $55,000
• Accumulated Depreciation: $8,000
• Long-term Debt: $28,000
• Common Stock: $20,000
• Retained Earnings: $22,200

Requirements:

1. Prepare a trial balance.
2. Record adjusting entries for:
   • Depreciation expense: $4,500
   • Prepaid rent expired: $600
3. Prepare an adjusted trial balance.
4. Draft a statement of cash flows.
5. Discuss the impact of long-term debt on a company's financial health.