Question #2 (30 marks).

The financial statements of Barca Company are presented below:

Comparative Balance Sheets	December 2022 [End]	December 2021 [Beg]
Cash	$ 3,000	$ 3,960
A/R	20,520	21,600
Inventory	36,840	35,400
Land	40,320	30,000
Building and equipment, net	117,000	109,440
Totals	$217,680	$200,400
A/P	$ 19,560	$ 19,200
Unearned revenue	11,880	13,200
Deferred tax liability	12,000	11,280
B/P	60,000	60,000
Discount on B/P	(7,920)	(8,400)
C/S	102,000	96,000
R/E	20,160	9,120
Totals	$217,680	$200,400

2022 Cash Flow Statement

Cash collections from customers $363,360

Cash disbursements for:

Commissions 4,080

Purchases 304,275

Interest 4,800

Taxes 11,565

Total disbursements 324,720

CFO $38,640

Investing:

Disposition of equipment 6,840

Acquisition of land (10,320)

Acquisition of BBE (31,320)

CFI (34,800)

Financing

Issue of C/S 6,000

Cash Dividends (10,800)

CFF (4,800)

TCF $(960)

Additional information

Equipment with a cost of $7,560 and a book value of $4,800 was sold for $6,840.

Cash dividends were paid in 2022. The tax rate is 36%.

Required:

Prepare the income statement for 2022. (20 marks)

Explicitly show how you calculated Sales revenue, CGS, and depreciation expense.

Write your answers in the I/S template.

2022 Income Statement
Sales revenue	$?
CGS	?
Depreciation expense	?
Sales commission (all cash)	?
Interest expense	?
Gain on sale of equipment	?
Income before taxes	?
Income tax expense(36%)	?
Net income	$?

Compute FCF using the formula 10 marks

Calculate NOPAT here.

It is helpful to construct the table below

2022 2021

OA

OL

NOA