Assume that you are the president of Highlight Construction Company. At the end of the first year (December 31, 2014) of operations, the following financial data for the company are available:

Cash $25,600

Receivables from customers (all considered collectibles) $10,800

Inventory of merchandise (based on physical count and priced at cost) $81,000

Equipment owned at cost less used portion $42,00

Salaries payable for 2014 (December 31, 2014 this was owed to an employee who was away because of an emergency; will return January 10, 2015; at which time the payment will be made)

Total sales revenue $128,400

Expenses, including the cost of the merchandise sold (excluding income taxes) $80,200

Income taxes expense at 30% x pretax income; all paid during 2014 ?

Common stock (December 31, 2014) $87,00

(Note: The beginning balances in common stock and retained earnings are zero because it is the first year of operations $10,000)

Required:

Using the financial statement exhibits in the chapter as models and showing computations:

1. Prepare a summarized income statement for the year 2014.
2. Prepare a statement of stockholders? equity for the year 2014.
3. Prepare a balance sheet at December 31, 2014.

CP1-2 Finding Financial Information LO 1-1 Refer to the financial statements of Urban Outfitters in Appendix C at the end of this book. Required: 1. What is the amount of net income for the most recent year? Net income This information can be found on the 2. What amount of revenue was earned in the most recent year? Net sales This information can be found on the 3. How much inventory (in dollars) does the company have as of January 31, 2012? Inventory This information can be found on the 4. By what amount did cash and cash equivalents * change during the most recent year? Cash and Cash Equivalents by This information can be found on the 5. Who is the auditor for the company? * Cash equivalents are short-term investments readily convertible to cash whose value is unlikely to change. ely to change. CP 1-2 Finding Financial Information Requirement 2: Net Sales = $2,473,801,000. P1-1 Preparing an Income Statement, Statement of Stockholders Equity, and Balance Sheet LO1-1 Assume that you are the president of Highlight Construction Company. At the end of the first year (December 31, 2014) of ope following financial data for the company are available: $ Cash Receivables from customers (all considered collectible) Inventory of merchandise (based on physical count and priced at cost) Equipment owned, at cost less used portion Accounts payable owed to suppliers Salary payable for 2014 (on December 31, 2014, this was owed to an employee who was away because of an emergency; will return around January 10, 2015, at which time the payment will be made) Total sales revenue Expenses, including the cost of the merchandise sold (excluding income taxes) Income taxes expense at 30% pretax income; all paid during 2014 Common stock (December 31, 2014) Dividends declared and paid during 2014 (Note: The beginning balances in Common stock and Retained earnings are zero because it is the first year of operations.) Required: 1. Prepare a summarized income statement for the year 2014. HIGHLIGHT CONSTRUCTION COMPANY Income Statement For the Year Ended December 31, 2014 2. Prepare a statement of stockholders' equity for the year 2014 HIGHLIGHT CONSTRUCTION COMPANY Statement of Stockholders' Equity For the Year Ended December 31, 2014 Common Stock Balance December 31, 2013 Balance December 31, 2014 3. Prepare a balance sheet at December 31, 2014. HIGHLIGHT CONSTRUCTION COMPANY Balance Sheet At December 31, 2014 Assets Total assets Liabilities Total liabilities Stockholders' Equity Total stockholders' equity Total liabilities and stockholders' equity year (December 31, 2014) of operations, the 25,600 10,800 81,000 42,000 46,140 2,520 128,400 80,200 ? 87,000 10,000 the first year of operations.) Retained Earnings $ - $ - $ $ - P1-1 Preparing an Income Statement, Statement of Stockholders Equity, and Balance Sheet LO1-1 Assume that you are the president of Highlight Construction Company. At the end of the first year (December 31, 2014) of following financial data for the company are available: $ Cash Receivables from customers (all considered collectible) Inventory of merchandise (based on physical count and priced at cost) Equipment owned, at cost less used portion Accounts payable owed to suppliers Salary payable for 2014 (on December 31, 2014, this was owed to an employee who was away because of an emergency; will return around January 10, 2015, at which time the payment will be made) Total sales revenue Expenses, including the cost of the merchandise sold (excluding income taxes) Income taxes expense at 30% pretax income; all paid during 2014 Common stock (December 31, 2014) Dividends declared and paid during 2014 (Note: The beginning balances in Common stock and Retained earnings are zero because it is the first year of operations.) Required: 1. Prepare a summarized income statement for the year 2014. HIGHLIGHT CONSTRUCTION COMPANY Income Statement For the Year Ended December 31, 2014 Net income $27,160 2. Prepare a statement of stockholders' equity for the year 2014 HIGHLIGHT CONSTRUCTION COMPANY Statement of Stockholders' Equity For the Year Ended December 31, 2014 Common Stock Balance December 31, 2013 Balance December 31, 2014 3. Prepare a balance sheet at December 31, 2014. HIGHLIGHT CONSTRUCTION COMPANY Balance Sheet At December 31, 2014 Assets Total assets Liabilities Total liabilities Stockholders' Equity Total stockholders' equity Total liabilities and stockholders' equity year (December 31, 2014) of operations, the 25,600 10,800 81,000 42,000 46,140 2,520 128,400 80,200 ? 87,000 10,000 the first year of operations.) Retained Earnings $ 159,400 $ - $ $