Compute Kopec Production Company’s current ratio and debt ratio at December 31. A year ago, the…

(Learning Objective 4, 6: Preparing a classified balance sheet and using the ratios)

Required

1. After solving Exercise 3-30, use the data in that exercise to prepare Kopec Production Company’s classified balance sheet at December 31 of the current year. Use the report format. First you must compute the adjusted balance for several of the balance-sheet accounts.

2. Compute Kopec Production Company’s current ratio and debt ratio at December 31. A year ago, the current ratio was 1.55 and the debt ratio was 0.45. Indicate whether the company’s ability to pay its debts—both current and total—improved or deteriorated during the current year.

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