Chemalite Inc - study case

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EXECUTIVE SUMMARY In the case of Chemalite, Inc. we analyzed the financial data provided by one of the largest stockholders of the company, Bennett Alexander, and the company’s bookkeeper. According to given expenditures, transactions, cash outflows and other related financial information; we prepared transaction journals, T-accounts, income statements, statements of financial position and statements of cash flows for the six months ended June 30, 2003 and for the year ended December 31, 2003. We then concluded our report with an analysis about the financial performance of Chemalite, Inc. for its first year. THE DATA The case of Chemalite, Inc. gives detailed information about how the company was formed and the financial data of the…show more content…
Statement of cash flows for the six-month period OPERATING ACTIVITIES Net Income $ -7,500 Depreciation and Amortization $ - Change in Account Receivable $ - Change in Inventory $ -75,000 Change in Current Liabilities $ - Net Cash provided by Operating Activities $ -82,500 INVESTING ACTIVITIES Purchase of equipment $ -62,500 Net Cash used by Investing Activities $ -62,500 FINANCING ACTIVITIES Net Cash provided by Financing Activities $ - CASH and CASH EQUIVALENTS Cash balance on Jan 1, 2003 $ 375,000 End of Period $ 230,000 The forth question asks to prepare a statement of financial position at December 31, 2003, an income statement and a statement of cash flows for the year ended December 31, 2003. These statements and also the transaction journal and T-accounts for the year ended December 31, 2003 are shown in Table 6, Table 7, Table 8, Table 9 and Table 10. Table 6. Transaction journal for the year ended December 31, 2003 Date Entry No. Accounts and Explanation Debit Credit 1/2/2003 1 Intengible Assets (patent) $ 125,000 Cash $ 375,000 Shareholder 's Equity $ 500,000 Establishment of Chemalite,

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