Kayla Hershberger and Emily Hertel

E4-3
a.

total net revenue

Sales revenue
Sales returns and allowances
sales discounts
Net Revenue

b.

net income
Sales revenue
Sales returns and allowances
sales discounts
Net Revenue
Costs of Goods Sold
Gross Profit
Selling Expenses
Administrative Expenses
Income from Operating Expenses
Other Gains
Rent Revenue
Dividend Revenue
Other Losses
Interest Expense
Net Income Before Tax
Income Tax Expense
Net Income

c.

$
$

Dividend Declared
Beginning RE
Net Income
Ending RE
Dividends

d.

6,500
71,000

+
-

Income attributable
Conctrolling Stockholders
37300*.25
37300*.50

$
$

9,325
18,650

Income Attributable to controlling stockholders is between $9325 and $18650

$
$
$
$

390,000
12,400
7,800
369,800

$
$
$
$
$
$
$
$
$

390,000
12,400
7,800
369,800
184,400
185,400
99,400
82,500
3,500

77,500

$
$
$
$

12,700
68,300
31,000
37,300

$
$
$
$

114,400
37,300
125,000
26,700

25-50%

25 and $18650

E 4-5
a.

P. Bride Company
Income Statement
For Year Ended December 31, 2017
Sales Revenue
COGS
Gross profit
Selling Expenses
Delivery Expense
Sales Commissions
Depreciation of Sales Equipment
Admin. Expenses
Officer Salary
Depreciation of Office Furniture and Equip.
Income from operations
Other Gains
Rent Revenue
Other Losses
Interest Expense
Income before Tax
Income Tax
Net Income
Earnings Per Share

b.

c.

2,690
7,980
6,480

$
$

4,900
3,960

(16220/40550)

P. Bride Company
Income Statement
For Year Ended December 31, 2017
Sales Revenue
$
Rent Revenue
$
COGS
$
Gross Profit
$
Interest Expense
$
Selling Expense
$
Admin Expense
$
Income Tax Expense
$
Net Income
$
Earnings per Share

$
$
$

96,500
17,230
60,570
53,160
1,860
17,150
8,860
9,070
16,220
0.40

We like the muti-step income statement more because it show more detail.

$
$
$

96,500
60,570
35,930

17,150

$
$

8,860
9,920

17,230

$
$
$
$

1,860
25,290
9,070
16,220

0.40

P 5-2
Montoya, Inc.
Balance Sheet
2017
Current Assets
Cash
Notes Receivable
Income Tax Receivable
Inventory
Debt Investment Trading
Prepaid Expenses
Total Current Assets
Noncurrent Assets
Property, Plant, and Equipment
Land
Equipment
Acc. Depreciation - Equipment
Buildings
Acc. Depreciation - Buildings
Intangible Assets
Goodwill
Total Noncurrent Assets
Total Assets
Current Liabilities
Accounts Payable
Notes Payable (to banks)
Payroll Taxes Payable
Rent Payable
Income Taxes Payable
Total Current Liabilities
Noncurrent Liabilities
Bonds Payable
Discount on Bonds Payable
Notes Payable (Long Term)
Rent Paybale (Long Term)
Total Noncurrent Liabilities
Total Liabilities
Owners' Equity
Common Stock
Preferred Stock
Retained Earnings
Total Owners' Equity
Total Liabilities and Owners' Equity

$
$

$
$
$
$
$
$
$

360,000
445,700
97,630
239,800
121,000
87,920
1,352,050

$
1470000
292000 $
1640000
270200 $

480,000
1,178,000

$
$
$

125,000
3,152,800
4,504,850

$
$
$
$
$
$

49,000
26,500
177,591
45,000
98,362
396,453

300,000
15,000 $
$
$
$
$

285,000
1,600,000
480,000
2,365,000
2,761,453

$
$
$
$
$

200,000
150,000
1,393,397
1,743,397
4,504,850

1,369,800

P 5-7

a.

Aero Inc.
Statement of Cash Flows
For the Year Ended December 31, 2017
Cash Flows from Operating Activities
Net Income
Adjustments
Loss on Debt Investment (available-for-sale)
$
Depreciation Expense
$
Increase in Accounts Receivable
$
Increase in Accounts Payable
$
Cash provided by Operating Activities
Cash Flows from Investing Activities
Sales of Investments
Purchased Land
Cash used in Investing Activities
Cash Flows from Financing Activities
Issuance of Common Stock
Paid Dividend
Cash provided from Financing Activities
Net Increase in cash
Cash at beginning of year
Cash at end of year
b.

Assets:
Cash
Accounts Receivable
Plant assets (net)
Land
Total Assets

70,200
42,000
69,000
108,000

5,000
12,000
(20,800)
10,000

Aero Inc.
Balance Sheet
December 31, 2015
Liabilities:
Accounts Payable
Bonds Payable
Owner's Equity
Common Stock
Retained Earnings
$ 289,200 Total Liabilities

c.
Net cash provided by operating activities
Less: Capital Expenditures
Dividends
Free cash flow

35,000

$
$

6,200
41,200

$
$
$

27,000
(38,000)
(11,000)

$
$
$
$
$
$

30,000
(10,000)
20,000
50,200
20,000
70,200

40,000
71,000
130,000
48,200
$

289,200

41,200
(38,000)
10,000
13,200