Declan's Designs Income Statement

For the Year Ending

$\frac{12}{31}\frac{?}{2022}$

Sales Revenue

CGS

Gross Margin

SG&A

Operating Income

Interest Expense

Loss on Sale of PPE

Pre$-$Tax Income

Income Tax Expense

Net Income

Additional Information regarding Declan's Designs' $12/31/22$ financials:

PROPERTY, PLANT & EQUIPMENT

PPE is shown net accumulated depreciation. Accumulated depreciation was $$18,000$ at the beginning of

the year and $$20,000$ at the end of the year. Depreciation expense for the year was $$3,000,$ which is

included in SG&A$.$ New PPE was bought during the year for $$22,000($in cash$).$

Note: You may use the worksheet provided on the last page to help you prepare the Cash Flow Statement.

Hint #$1$: The most recent year is not always in the left column.

Hint #$2$: Evaluate changes in gross PPE separate from changes in accumulated depreciation. Recall gross

PPE less accumulated depreciation equals net PPE.

Hint #$3$: Never "plug" the annual change in gross PPE. Separately evaluate the increase in gross PPE

$($capital expenditures$)$ from the annual decrease in gross PPE $($sale of PPE$).$

Hint #$4$: The total change in cash due to stock issuances$/$repurchases is the sum of the change in common

stock $($stated par value$)$ and additional paid in capital $($APIC$).$

Hint #$5$: Dividends declared $($the decrease in RE$)$ is not the same as dividends paid $($the decrease in

dividends payable$).$ To find dividends paid, set up your dividends payable account with the beginning and

ending balances from the balance sheet. Increase dividends paid by the amount of dividends declared.

Then plug for the decrease in dividends payable $($which represents dividends paid$).$ Part A: Complete the Gross PPE and Accumulated Depreciation T$-$Accounts for

$2022,$ including beginning and ending balances, and all changes throughout the year:

Part B: Complete the following journal entries: Part C: Complete the Dividends Payable and Retained Earnings T$-$Accounts for

$2022,$ including beginning and ending balances, and all changes throughout the year:

Part D: Complete the following journal entry:Part E: Complete the following $2022$ Statement of Cash Flows:

Cash Flows From Operating Activities:

Cash flow from $($used in$)$ operating activities

Cash Flows From Investing Activities:

Cash flow from $($used in$)$ investing activities

Cash Flows From Financing Activities:

Cash flow from $($used in$)$ Financing activities

INCREASE $($DECREASE$)$ IN CASH

Cash, beginning of year

Cash, end of yearDeclan's Designs Balance Sheet

ASSETS

Current Assets

Cash and Cash Equivalents

Accounts Receivable, Net

Merchandise Inventory

Total Current Assets

PPE, Net

Goodwill, Net

Total Assets

LIABILITIES & SHAREHOLDERS' EQUITY

Current Liabilities

Accounts Payable

Interest Payable

Dividends Payable

Total Current Liabilities

Mortgage Payable

Long$-$Term Bank Loan

Total Liabilities

Shareholder's Equity

Preferred Stock

Common Stock

Additional Paid in Capital

Retained Earnings

Total Shareholder's Equity

Total Liabilities &Shareholders' Equity

$$1,249,000,$$$1,540,000$