Balance Sheet
Assets								Liab				Equity
Cash	Acct Rec	Inventory	Equipment	Land	Building	-	Accum Depr	Acct Payable	Div Payable	Notes Payable	Wages Payable	Common Stock	APIC	Retained Earnings
Acquired $550,000 by signing a note payable with a local bank	$ 550,000										$ 550,000
Sold 25,000 shares of $22 Common Stock for $1,500,000	$ 1,500,000						-						$ 550,000	$ 950,000
Purchased Equipment	$ (200,000)			$ 200,000			-
Purchased Inventory on Account - 25,000 Units at $1.15 per unit			$ 28,750						$ 28,750
5a. Sold 15,000 units at $3.50 on Account		$ 52,500					-								$ 52,500
COGS for Sales on Account			$ (17,250)												$ (17,250)
Collect $70,000 on Account	$ 70,000	$ (70,000)					-
Paid $17,250 of Accounts Payable	$ (17,250)								$ (17,250)
Purchased Inventory on Account - 170,000 Units at $1.50 per unit			$ 255,000				-		$ 255,000
Sold 175,000 units at $3.50 on Account		$ 612,500					-								$ 612,500
COGS for Sales on Account			$ (201,250)				-								$ (201,250)
Collect $472,500 on Account	$ 472,500	$ (472,500)					-
Paid $118,600 of Accounts Payable	$ (118,600)						-		$ (118,600.00)
Purchased Inventory on Account - 275,000 Units at $1.45 per unit			$ 398,750				-		$ 398,750
Sold 200,000 units at $3.50 on Account		$ 700,000					-								$ 700,000
COGS for Sales on Account			$ (270,750)				-								$ (270,750)
Collect $735,000 on Account	$ 735,000	$ (735,000)					-
Paid $294,150 of Accounts Payable	$ (294,150)						-		$ (294,150.00)
Purchased Inventory on Account - 300,000 Units at $1.15 per unit			$ 345,000						$ 345,000.00
Paid Sales & Marketing Expenses of $30,000	$ (30,000)						-								$ (30,000)
Paid Operating Expenses of $75,708	$ (75,708)						-								$ (75,708)
Paid Wage Expenses of $40,000	$ (40,000)						-								$ (40,000)
Paid Product Line Research & Development Expenses of $150,000	$ (150,000)						-								$ (150,000)
Paid Advertising Expenses of $87,500	$ (87,500)						-								$ (87,500)
Made the yearly required payment on the note payable. The note carries a 7% interest rate and requires payments of $50,000 plus interest each December 31.	$ (88,500)										$ (50,000)				$ (38,500)
Record Yr 1 Depreciation on Equipment with Salvage Value of $38,000 & useful life of 7 Yrs							-	$ (23,143.00)							$ (23,143)
Declared a $10,000 cash dividend for stockholders										$ 10,000.00					$ (10,000)
Paid a $10,000 cash dividend for stockholders	$ (10,000)									$ (10,000.00)
Balance at end of Yr 1	$ 2,215,792	$ 87,500	$ 538,250	$ 200,000	$ -	$ -	-	$ (23,143)	$ 597,500	$ -	$ 500,000	$ -	$ 550,000	$ 950,000	$ 420,899

B D 1 1 Income Statement Year 1 2 3 4. Sales Revenue 5 Less: Cost of Goods Sold 6 Gross Margin $ 7 9 10 1 12 8 Less: Expenses Sales & Marketing Operating Costs Wages Research & Development Expense 13 Advertising Expense Depreciation Expense 15 Interest Expense 16 Total Operating Expenses 17 18 Net Income (Loss) 19 14 $ $ 20 He N Balance Sheet Year 1 3 4 5 Assets 6 Cash $ $ 7 B 9 10 $ Total Assets $ 15 Liabilities 16 Accounts Payable 17 18 20 Total Liabilities $ $ 22 Stockholders Equity 23 20 25 Total Stockholders Equity $ 27 23 29 Total Liabilities and Stockholders Equity $ Statement on Stockholders' Equity Year 1 3 4 5 6 Beginning Common Stock 7 Plus: common stock issued 8 Plus: additional paid in capital Ending Common Stock $ 10 11 Beginning Retained Earnings 12 Plus: Net Income 1a Less: Dividends 1 Ending Retained Earnings 15 16 Total Stockholders' Equity 13 2 Statement of Cash Flows Year 1 3 4 6 s Cash flows from operating activities Cash receipts from revenue Cash payments for expenses 8 Net cash flow from operating activities 7 $ 9 10 Cash flows from investing activities: 21 Cash payments to purchase equipment $ 12 13 Cash flows from financing activities: 24 Cash receipts from borrowing funds 15 Cash receipts from issuing common stock 16 Cash payments to repay borrowed funds 17 Cash payments for dividends 18 Net cash flow from financing activities 19 $ $ 20 Net increase/(decrease) in cash 2. Plus: beginning cash balance 22 Ending cash balance $ 23 24