Compute the Liquidity Ratios for Company K Excel Task

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Journalize closing entries, prepare a post-closing trial balance, and calculate liquidity ratios. Complete the following spreadsheet: Closing Process.Slide 1 of 1

ACCT203-IP4-Closing Entries- Solution Prepare the closing entries for Colorado Service Center at December 31, 2021 using the jounal entry template on the next tab. Colorado Service Center Adjusted Trial Balance 12/31/2021 ACCOUNT DEBIT Cash 68,195 Equipment 17,500 Truck 29,000 Accum. deprec. equipment Accum. deprec. truck Accounts receivable 10,160 Supplies 785 Land 26,500 Prepaid auto insurance 600 Accounts payable Notes payable Salaries payable Utilities payable Unearned service revenue Harper, capital Harper, drawing 14,025 Service revenue Depreciation expense – Equipment 2,350 Depreciation expense – Truck 1,875 Insurance expenses 1,500 Rent expenses 11,000 Salary expenses 16,350 Supplies expenses 1,305 Maintenance expenses 1,750 Utilities expenses 2,375 Total 205,270 CREDIT 2,350 1,875 3,775 49,000 6,350 375 1,725 80,000 59,820 205,270 STUDENT Journal Entry ACCOUNT 12/31/2021 12/31/2021 12/31/2021 12/31/2021 DEBIT CREDIT Please complete the following exercises: EA1. LO 5.3 Using the given balance sheet summary information, calculate the following for the 2 years presented: A. Working capital B. Current ratio Solution A. Current Assets Current Liabilities Working Capital (CA – CL) 12/31/2018 0 0 0 12/31/2019 12/31/2018 0 0 12/31/2019 0 0 0 B.

Current Assets Current Liabilities Current Ratio (CA/CL) 0 0 0 EA2. LO 5.3 Using the given account balances, calculate the following for the 2 years presented: A. Working capital B. Current ratio Solution A. Current Assets Current Liabilities Working Capital (CA – CL) B. 12/31/2018 0 0 0 12/31/2019 0 0 0 Current Assets Current Liabilities Current Ratio (CA/CL) 12/31/2018 0 0 0 12/31/2019 0 0 0 EA3. LO 5.3 Using the given balance sheet summary information, calculate the following for the two companies pre A. Working capital B. Current ratio Then: C. Evaluate which company’s liquidity position appears stronger, and explain why. Solution A. Company J Current Assets Current Liabilities Working Capital (CA – CL) Company K 0 0 0 0 0 0 B. Company J Current Assets Current Liabilities Current Ratio (CA/CL) C. Company K 0 0 0 0 0 0

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