Submission Requirements The entire assignment must be submitted in the Assignments section on Blackboard as ONE document.
Question:
Submission Requirements
The entire assignment must be submitted in the Assignments section on Blackboard as ONE document.
oEmailed assignments will not be accepted.
Late assignments will not be accepted.
PDF's will not be accepted.
Solutions must be in MS Word.Handwritten work will not be accepted.
All financial statements must be in chart form (in Word).Images (jpeg, gif etc. will not be accepted.
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Question #1 - (20 marks)
Based on the Chart of Accounts in Appendix A for JJ SPORTS Inc. create the Income Statement, Balance Sheet and Statement of Changes of Owners Equity for both 2019 & 2020.
Use the templates provided for how they should look.
oEnsure you include all the accounts (do not just put totals). Example, there should be no Net Fixed Assets etc.
Company's tax rate is 35%.
Retained Earnings are beginning balances, as of January 1st each year. You must calculate their ending balances for the Statement of Changes of Owners Equity.
Question #2 - (10 marks - 400 -600 words)
Based on the financial statements you created:
1.What could you conclude about JJ SPORTS Inc.'s financial performance over the past 2 years?
2.What stands out to you?
3.Do you have any concerns?
Do not do any detailed analysis.Only use the information from your financial statements.
Appendix A
Chart of Accounts
JJ SPORTS Inc.
31-Dec-19
31-Dec-20
Balance
Balance
Account
Debit
Credit
Debit
Credit
Cash
$902,500
$1,657,125.0
Accounts Receivable
$387,500
$597,500
Office Supplies
$87,500
$127,500
Manufacturing Equipment
$1,500,000
$1,500,000
Inventory
$430,000
$800,000
Acc. Depreciation Equipment
$600,000
$750,000
Accounts Payable
$212,500
$425,000
Interest Payable
$37,500
$67,500
Income Taxes Payable
$235,375
$321,125
Long-term Notes Payable
$625,000
$875,000
Common Stock
$1,000,000
$1,250,000
Retained Earnings @ Jan 1st
$260,000
$597,125
Owners Withdrawals
$50,000
Dividends
$100,000
$150,000
Equipment Sales
$7,901,250
$12,718,750
Office Salaries
$900,000
$1,292,500
Insurance
$20,000
$27,500
IT Network Expense
$62,500
$93,750
Utilities
$120,000
$192,500
Sales Salaries & Commissions
$260,000
$550,000
Advertising
$263,750
$362,500
Interest Expense
$37,500
$52,500
Maintenance & Repair Expense
$121,250
$206,250
Rent
$240,000
$330,000
Income Tax Expense
$235,375
$321,125
Depreciation Expense Equipment
$150,000
$150,000
Cost of Goods Sold
$5,053,750
$8,543,750
Total
$10,871,625
$10,871,625
$17,004,500
$17,004,500
Appendix B - Financial Statements Basic Templates
Below are the titles you should include in your financial statements.
You will need to add many rows to include all the right accounts under each section.
Ensure EVERY account is listed somewhere on these financial statements. DO NOT just put the totals.
JJ SPORTS Inc.
Income Statement
..........
.....................
...................
Revenues:
**list of accounts here**
Gross Profit
Operating Expenses:
Selling Expenses
**list of accounts here**
Total Selling Expenses
General & Admin Expenses
***list of accounts here***
Total G & A Expenses
Total Operating Expenses
EBIT
**account here**
Earnings before Tax
**account here**
Earnings After Tax
JJ SPORTS Inc.
Statement of Changes in Owner's Equity
Common Stock
Retained Earnings
**list of accounts here**
Retained Earnings
Owner's Equity
JJ SPORTSInc.
Balance Sheet
.................
...................
..................
Assets
Current Assets:
**list of accounts here**
Total Current Assets
Property, plant and equipment:
**list of accounts here**
Total property, plant and equipment
Total Assets
Liabilities
Current liabilities
**list of accounts here**
Total Current Liabilities
Long Term Liabilities
**list of accounts here**
Total Long Term Liabilities
Total Liabilities
Shareholders Equity
JJ SPORTS Equity
Total Owner's Equity
Total Liabilities & Equity
Expert Answer:
