3. Determine the ratios of fixed assets to capital stock, of working capital to net worth, and of current assets to current liabilities.
4. Write a brief statement of about 150 words giving your opinion of the financial condition of the concern.
IX
1. Enter in ledger “T” accounts the information for the “end of the year” given in [Assignment VII, Problem 1], page 525.
2. Using the account titles in the ledger of Problem 1, draw up a chart of accounts similar to [Form 2, page 75].
3. Show and explain how the ledger of Problem 1 is the proprietorship equation.
4. Draw up a profit and loss statement to account for the change in proprietorship shown by [Assignment VIII, Problem 2], making your own assumptions as to items in the various sections of the statement.
5. State the probable business transactions occurring to bring about these changes in proprietorship (Problem 4), i.e., show the interaction of the profit and loss elements with the asset and liability elements in causing the changes in financial condition.
Instructions
Problem 1. A ledger “T” account is a skeleton account ruled only with the horizontal “title” line and the vertical line separating the left section from the right, date and amount columns being left without formal ruling.