Problem 3-8A Preparing closing entries, financial statements, and ratios LO A1, A2, P3, P4 The adjusted trial balance for Tybalt Construction as of December 31, 2017, follows. Credit Debit $ 6,000 24,000 9,100 8,100 45,000 $ 22,500 153,000 51,000 81,230 TYBALT CONSTRUCTION Adjusted Trial Balance December 31, 2017 No. Account Title 101 Cash 104 Short-term investments 126 Supplies 128 Prepaid insurance 167 Equipment 168 Accumulated depreciation-Equipment 173 Building 174 Accumulated depreciation-Building 183 Land 201 Accounts payable 203 Interest payable 208 Rent payable 210 Wages payable 213 Property taxes payable 233 Unearned professional fees 251 Long-term notes payable 307 Common stock 318 Retained earnings 319 Dividends 401 Professional fees earned 406 Rent earned 407 Dividends earned 409 Interest earned 606 Depreciation expense-Building 612 Depreciation expense-Equipment 623 Wages expense 633 Interest expense 637 Insurance expense 640 Rent expense 652 Supplies expense 682 Postage expense 683 Property taxes expense 684 Repairs expense 688 Telephone expense 690 Utilities expense Totals 16,500 2,200 3,200 2,900 800 7,800 70,000 6,000 126,500 12,200 105,000 18,000 2,200 2,400 11,220 6,750 27,500 4,500 8,200 12,200 7,200 3,300 3,800 7,200 2,100 4,400 $437,000 $437,000 The December 31, 2016, credit balance of the Retained Earnings account was $126,500. Tybalt Construction is required to make a $7,500 payment on its long-term notes payable during 2018. Required: 1a. Prepare the income statement for the calendar-year 2017 1b. Prepare the statement of retained earnings for the calendar-year 2017 1c. Prepare the classified balance sheet at December 31, 2017 2. Prepare the necessary closing entries at December 31, 2017 3. Use the information in the financial statements to compute the following ratios: The December 31, 2016, credit balance of the Retained Earnings account was $126,500. Tybalt Construction is required to make a $7,500 payment on its long-term notes payable during 2018. Required: 1a. Prepare the income statement for the calendar-year 2017. 1b. Prepare the statement of retained earnings for the calendar-year 2017. 1c. Prepare the classified balance sheet at December 31, 2017. 2. Prepare the necessary closing entries at December 31, 2017 3. Use the information in the financial statements to compute the following ratios: Complete this question by entering your answers in the tabs below. Required 1A Required 1B Required 10 Required 2 Required 3 Use the information in the financial statements to compute the following ratios: (a) Return on assets (total assets at December 31, 2016, was $200,000) Numerator: 1 Denominator: Return on total assets Net income 1 Average total assets Return on total assets 0 (b) Debt ratio Numerator: 1 Denominator: Debt ratio / Total assets Debt ratio II 0 = (c) Profit margin ratio (use total revenues as the denominator) Numerator: 1 Denominator: Profit margin Net income 1 Total revenues Profit margin 0 % (d) Current ratio Numerator: v Denominator: Current ratio Current assets 1 Current liabilities Current ratio 0