The assets, liabilities, and shareholders’ equity accounts of Lawson Corporation at December 31, 2015 are as follows:
|
Account |
Balance |
|
Accounts payable |
$10,000 |
|
Accounts receivable |
15,200 |
|
Accumulated depreciation – building |
1,000 |
|
Accumulated depreciation – equipment |
500 |
|
Building |
14,000 |
|
Cash |
5,600 |
|
Equipment |
4,000 |
|
Land |
5,000 |
|
Merchandize inventory |
5,600 |
|
Mortgage payable, due in 5 years |
8,000 |
|
Notes payable, due within 90 days |
7,500 |
|
Notes receivable, due in 120 days |
3,000 |
|
Prepaid insurance |
400 |
|
Retained earnings |
16,000 |
|
Share capital |
10,000 |
|
Unused supplies |
200 |
Required:
|
1. |
Prepare a classified balance sheet. |
|
|
2. |
a. |
What is the proportion of shareholder claims to the total assets of the corporation? |
|
b. |
What is the proportion of creditor’s claims to the total assets of the corporation? |
|
|
3. |
What does this indicate to you? |
|
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