Joshua & James

Income Statement

For the Year Ending 12/31/2013

Sales Revenue		100,000
Less Cost of Goods Sold		-60,000
Equals Gross Margin		40,000
Operating Expenses
Selling and Administration	15,000
Depreciation	7,000
Total Operating Expense		-22,000
Operating Income		18,000
Tax		-7,200
Net Income		10,800

Joshua & James

Statement of Retained Earnings

For the Year Ending 12/31/2013

Beginning Balance		10,000
Net Income		10,800
Less Dividends		-3,400
Ending Balance		17,400

Joshua& James

Balance Sheet

12/31/2012 & 12/31/2013

Category	2012	2013
Cash	20,000	25,000
Accounts Receivable	15,000	12,000
Inventory	30,000	52,000
Total Current Assets	65,000	89,000
Equipment	70,000	65,000
Less Accumulated Depreciation	-15,000	-19,000
Equipment (Net)	55,000	46,000
Total Assets	120,000	135,000
Accounts Payable	15,000	29,000
Long-term Liabilities	25,000	18,600
Total Liabilities	40,000	47,600
Common Stock	70,000	70,000
Retained Earnings	10,000	17,400
Total Equity	80,000	87,400
Total Liabilities & Equity	120,000	135,000

Shares of Stock Outstanding 2,000 2,000

Market Price per Share Common Stock 7.00 8.00

Problem 4 Cash Flow Statement

Use the financial information from Joshua & James Company to develop a cash flow statement for 2013.

Problem 5 Ratio Analysis

Use the financial information from Joshua & James Company to compute any three activity ratios, any one liquidity ratio, any one debt ratio, any three profitability ratios, and any two market ratios.