The accounting records of Nettle Distribution show the following assets and liabilities as of December 31,2018 and 2019.December 31 2018 2019Cash . . . . . . . . . . . . . . . . . . . . . . . . $ 64,300 $ 15,640Accounts receivable . . . . . . . . . . . 26,240 19,100Office supplies . . . . . . . . . . . . . . . . 3,160 1,960Office equipment . . . . . . . . . . . . . . 44,000 44,000Trucks . . . . . . . . . . . . . . . . . . . . . . . 148,000 157,000December 31 2018 2019Building . . . . . . . . . . . . . . . . . . . . . $ 0 $80,000Land . . . . . . . . . . . . . . . . . . . . . . . . 0 60,000Accounts payable . . . . . . . . . . . . . 3,500 33,500Note payable . . . . . . . . . . . . . . . . . 0 40,000Required1. Prepare balance sheets for the business as of December 31, 2018 and 2019. Hint: Report only total equityon the balance sheet and remember that total equity equals the difference between assets and liabilities.2. Compute net income for 2019 by comparing total equity amounts for these two years and using thefollowing information: During 2019, the owner invested $35,000 additional cash in the business andwithdrew $19,000 cash for personal use.3. Compute the 2019 year-end debt ratio (in percent and rounded to one decimal).
The accounting records of Nettle Distribution show the following assets and liabilities as of December 31,
2018 and 2019.
December 31 2018 2019
Cash . . . . . . . . . . . . . . . . . . . . . . . . $ 64,300 $ 15,640
Accounts receivable . . . . . . . . . . . 26,240 19,100
Office supplies . . . . . . . . . . . . . . . . 3,160 1,960
Office equipment . . . . . . . . . . . . . . 44,000 44,000
Trucks . . . . . . . . . . . . . . . . . . . . . . . 148,000 157,000
December 31 2018 2019
Building . . . . . . . . . . . . . . . . . . . . . $ 0 $80,000
Land . . . . . . . . . . . . . . . . . . . . . . . . 0 60,000
Accounts payable . . . . . . . . . . . . . 3,500 33,500
Note payable . . . . . . . . . . . . . . . . . 0 40,000
Required
1. Prepare balance sheets for the business as of December 31, 2018 and 2019. Hint: Report only total equity
on the
2. Compute net income for 2019 by comparing total equity amounts for these two years and using the
following information: During 2019, the owner invested $35,000 additional cash in the business and
withdrew $19,000 cash for personal use.
3. Compute the 2019 year-end debt ratio (in percent and rounded to one decimal).
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