1 2 3 Balanced Sheet A Assets 5 Cash 6 Accounts receivable 7 Inventory 8 Property, plant & equipment (net) 9 Other assets 10 Total assets 11 12 Liabilities & stockholders' equity 13 Accounts payable 14 Bonds payable 15 Common stock 16 Retained earnings Edman Company Balance Sheets 17 Total abilities & stocholders' equity 18 19 Edman Company 20 Income Statement 21 Sales Cost of goods sold 22 Variable expenses 23 24 Variable selling expense 25 Total variable expenses 26 Contribution margin 555 Beginning Ending Balance Balance Average Balance 150,000 $ S 75,000 180,000 240,000 793,000 37,000 1,400,000 $ 75,000 $ 80,000 $ 550,000 $ 410,000 $ 360,000 S 1,400,000 $ 27 Fixed expenses: 28 Fixed selling expense 29 Fired administrative expense 300,000 30 Total fixed expenses 300,000 31 Net operating income (300,000) 32 Interest expense (8%) 33 Net income before tax (300,000) 34 Tax expense (30%) (90,000) 35 Net income $ (210,000) 36 + E