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1)Presented below is information related to equipment owned by Blossom Company at December 31, 2020

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1)Presented below is information related to equipment owned by Blossom Company at December 31, 2020. Cost Accumulated depreciation to date Expected future net cash flows Fair value $11,070,000 1,230,000 8,610,000 5,904,000 Blossom intends to dispose of the equipment in the coming year. It is expected that the cost of disposal will be $24,600. As of December 31, 2020, the equipment has a remaining useful life of 4 years. Prepare the journal entry (if any) to record the impairment of the asset at December 31, 2020. (If no entry is required, select "No entry" for the account titles and enter Ofor the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Dec. 31

2)Mr Harley finds it really difficult to use his company's financial statements as management tool for decision making. Accounting data collected over time is used by him to prepare the three financial statements viz. cash flow statement, Fund flow statement and common size statement takes the company’s financial pulse in a different view.

a. Help Mr. Harley to interpret his balance sheet in a better way.

b.To what extend he can depend accounting ratios. Illustrate your answer.