The adjusted trial balance for Anara Co. as of December 31, 2013, follows.

P. Anara invested $40,000 cash in the business during year 2013 (the December 31, 2012, credit balance of the P. Anara, Capital account was $52,800). Anara Company is required to make a $8,400 payment on its long-term notes payable during 2014.

Required
1. Prepare the income statement and the statement of owner’s equity for the calendar year 2011 and the classified balance sheet at December 31, 2013.
2. Prepare the necessary closing entries at December 31, 2013.
3. Use the information in the financial statements to calculate these ratios:
(a) Return on assets (total assets at December 31, 2012, were $160,000),
(b) Debt ratio,
(c) Profit margin ratio (use total revenues as the denominator),
(d) Current ratio. Round ratios to three decimals for parts a and c, and to two decimals for parts b andd.

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ANARA COMPANY Adjusted Trial Balance December 31,2013 No. Account Tide Debit Credit 0 Cash 7,400 II,200 4,600 1,000 24,000 126 Supplies 128 Prepaid insurance.. 168 Accumulated depreciation Equipment 173 Building 174 Accumulated depreciation Building. 183 Land $ 4,000 100,000 0,000 30,500 203 Interest payable.... 208 Rent payable 210 Wages payable.. 213 Property taxes payable . 233 Unearned professional fees. 25 Long-term notes payable 30 P Anara, Capital 302 P Anara, Withdrawals 401 Professional fees earned .*^_ . 406 Rent earned .. 407 Dividends earned 3,500 1,750 400 I,280 3,330 750 40,000 92,800 8,000 59,600 4,500 1,000 1,320 e Building 606 Depreciation expens 612 Depreciation expense Equipment 623 Wages expense. 633Interest expense 637 Insurance expense .a.. 640 Rent expense.. .. 652 Supplies expense. 682 Postage expense 683Property taxes expense 684 Repairs expense.... 688 Telephone expense 2,000 1,000 18,500 1,550 1,525 3,600 1,000 410 4,825 679 521 1,920