Acc280 Financial Accounting: E4-14 The adjusted trial balance for Karr Bowling Alley

Acc280 Financial Accounting
E4-14
The adjusted trial balance for Karr Bowling Alley at December 31, 2010, contains the following accounts.
Debits Credits
Building 128,800 Sue Karr, Capital 100,000
Accounts Receivable 14,520 Retained Earnings 15,000
Prepaid Insurance 4,680 Accumulated Depreciation-Building 42,600
Cash 18,040 Accounts Payable 12,300
Equipment 62,400 Note Payable 97,780
Land 64,000 Accumulated Depreciation-Equipment 18,720
Insurance Expense 780 Interest Payable 2,600
Depreciation Expense 7,360 Bowling Revenues 14,180
Interest Expense 2,600 303,180
303,180

Instructions:
a. Prepare a classified balance sheet; assume that $13,900 of the note payable will be paid in 2009. (List assets in order of liquidity and liabilities in descending order of amount.) (see current assets only)
b. Comment on the liquidity of the company.
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