Reference no: EM132705973

Question - The following items were taken from the accounting records of Talecom, Incorporated. The income statement and balance sheet at December 31, 2009 except for the retained earnings balance which is the balance at 1/1/2009:

Accounts Payable $ 52,000

Accounts Receivable $ 7,000

Land 121,000

Advertising Expense 11,000

Cash 108,000

Common Stock 15,000

Rent Expense 20,000

Dividends 1,000

Insurance Expense 5,000

Notes Payable (long-term) 62,000

Retained Earnings (beg) 52,300

Salaries Expense 22,000

Service Revenue 121,000

Inventory 3,000

Accumulated Depreciation 20,000

Supplies Expense 1,000

Salaries Payable 1,500

Additional Paid In Capital 100,000

Building 100,000

Income tax rate 40%

Instructions - Prepare an income statement, statement of retained earnings, and balance sheet. Also calculate and interpret Liquidity ratios; solvency ratios.