Assume that you are the president of High Power Corporation. At the end of the first year of operations (December 31), the following financial data for the company are available:

Accounts Payable

$

32,100

Accounts Receivable

9,550

Cash

13,300

Common Stock

59,090

Dividends

1,950

Equipment

86,000

Notes Payable

1,160

Operating Expenses

58,700

Other Expenses

7,850

Sales Revenue

90,000

Supplies

5,000

1-a.

Is the company financed mainly by creditors or stockholders?

	Creditors
	Stockholders

1-b.

Which financial statement indicates this?

	Income Statement
	Statement of Retained Earnings
	Balance Sheet
	Statement of Cash Flows

By how much did cash increase (decrease)?

2-b.

Which financial statement would report the reasons for this change in cash?

Income Statement

Statement of Retained Earnings

Balance Sheet

Statement of Cash Flows

3-a.

Was the company profitable?

	Yes
	No

3-b.

Which financial statement indicates this?

Income Statement

Statement of Retained Earnings

Balance Sheet

Statement of Cash Flows

4-a.

Did the companys dividends exceed its net income?

	Yes
	No

4-b.

Which financial statement indicates this?

	Income Statement
	Statement of Retained Earnings
	Balance Sheet
	Statement of Cash Flows

Required 1. Prepare an income statement for the year ended December 31. HIGH POWER CORPORATION Income Statement