The following accounts are from the accounting records of JadaTech Industries. Unless otherwise indicated, assume that all balance sheet items reflect account balances for the fiscal year that began on January 1, 2016 and ended on December 31, 2016. All income statement accounts reflect activities that occurred during that fiscal year. Paid-in capital 30,000 Gross revenue 675,000 Equipment 21,500 Accounts receivable 60,400 Merchandise inventory 224,500 Income tax expense 85,000 Cash 37,800 Notes payable (long term) 75,600 Interest expense 10,450.40 Depreciation expense 3,149.60 Accumulated depreciation 13,800 Rent expense 17,900 Sales discounts 9,000 Land 47,500 Cost of goods sold 462,000 Retained earnings (1/1/2016) 227,850.40 Accounts payable 24,149.60 This assignment is to be Typed using Microsoft Excel or similar software (I will not grade handwritten submittals). 1. Prepare the Balance Sheet. 2. Prepare the Income Statement. 3. Calculate the retained earnings if a dividend of $67,200 was paid during the year. Include a proper heading with each financial statement
Reporting Cash Flows
Reporting of cash flows means a statement of cash flow which is a financial statement. A cash flow statement is prepared by gathering all the data regarding inflows and outflows of a company. The cash flow statement includes cash inflows and outflows from various activities such as operating, financing, and investment. Reporting this statement is important because it is the main financial statement of the company.
Balance Sheet
A balance sheet is an integral part of the set of financial statements of an organization that reports the assets, liabilities, equity (shareholding) capital, other short and long-term debts, along with other related items. A balance sheet is one of the most critical measures of the financial performance and position of the company, and as the name suggests, the statement must balance the assets against the liabilities and equity. The assets are what the company owns, and the liabilities represent what the company owes. Equity represents the amount invested in the business, either by the promoters of the company or by external shareholders. The total assets must match total liabilities plus equity.
Financial Statements
Financial statements are written records of an organization which provide a true and real picture of business activities. It shows the financial position and the operating performance of the company. It is prepared at the end of every financial cycle. It includes three main components that are balance sheet, income statement and cash flow statement.
Owner's Capital
Before we begin to understand what Owner’s capital is and what Equity financing is to an organization, it is important to understand some basic accounting terminologies. A double-entry bookkeeping system Normal account balances are those which are expected to have either a debit balance or a credit balance, depending on the nature of the account. An asset account will have a debit balance as normal balance because an asset is a debit account. Similarly, a liability account will have the normal balance as a credit balance because it is amount owed, representing a credit account. Equity is also said to have a credit balance as its normal balance. However, sometimes the normal balances may be reversed, often due to incorrect journal or posting entries or other accounting/ clerical errors.
The following accounts are from the accounting records of JadaTech Industries. Unless otherwise indicated, assume that all balance sheet items reflect account balances for the fiscal year that began on January 1, 2016 and ended on December 31, 2016. All income statement accounts reflect activities that occurred during that fiscal year.
Paid-in capital 30,000
Gross revenue 675,000
Equipment 21,500
Merchandise inventory 224,500
Income tax expense 85,000
Cash 37,800
Notes payable (long term) 75,600
Interest expense 10,450.40
Rent expense 17,900
Sales discounts 9,000
Land 47,500
Cost of goods sold 462,000
Accounts payable 24,149.60
This assignment is to be Typed using Microsoft Excel or similar software (I will not grade handwritten submittals).
1. Prepare the Balance Sheet.
2. Prepare the Income Statement.
3. Calculate the retained earnings if a dividend of $67,200 was paid during the year.
Include a proper heading with each financial statement
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