I am confused as to where everything would go on a balance sheet and how to format it.

HOMEWORK #1 Due 5/3/20

You have been approached by Mrs. Laney Smith, who would like you to help her organize her financial information into financial statements in preparation for filing income taxes. Mrs. Smith has an Angora goat operation that runs approximately 350 does who have kids yearly. She sells the kids to other breeders and the fleece/wool from her goats to an out-of-state fiber mill.

She needs to put together Balance Sheets and Income Sheets for the last two yearends - (2017 and 2018).

1. Use the following information to create 1) a Balance Sheet for yearends 2017 and 2018 and 2) an Income Statement for 2018:

• Mrs. Smith only recognizes depreciation on her truck and trailer used to haul animals. She purchased the truck new for $50,000 on January 11, 2017 and the trailer was purchased for $10,000 in March of 2017. The estimated salvage value of the truck is $4,500 and a 7 year useful life; and the salvage value of the trailer is $2,000 after 10 years.

• When she purchased her truck and trailer, she only put $8,000 as a down payment on both. She financed the remaining portion with equal annual principle payments over 6 years. In addition to her annual principle payments, she makes annual interest payments of 10% of the balance on the loan.