which company has the Which communis Toys"R"Us? 7HL unter I through Chapter 12 ons for Kate's Cards. She As She ended the producing quality cards leading ards leading to more bus bringing in several emple and also purchase more equin de equipmend. N statements as year on a bhe can currently ill need to find a vou to look at her year-end financial statement. Al os and provide calcula SERIAL PROBLEM: KATE'S CARDS Nar: This w ow of the Serial Problem: Kate's Cards from Chapter SPIK Kate is very pleased with the results of the first year of operations for year on a high note, with the company's reputation for producing aus ness than she can currently manage. Kate is considering expanding and ces. In order to do this, she will need to find a larger location and also this means additional financing. Kate has asked you to look at her year you were a banker considering giving Kate a loan. Comment on your tions to support your comments Kate's Cards ing Kate a loan. Comment on your findings and KATE'S CARDS Income Statement Year Ended August 31, 2019 HO...... 10 $185.000 106.000 79,000 Sales revenue........ Cost of goods sold......... Gross profit. ...... Operating expenses 18,000 11,850 1,200 2,400 14,400 3,250 Wages ... Consulting.... Insurance ........... Utilities ............. Rent .......... Depreciation............ Total operating expenses Income from operations ........... Interest expense... Income before income tax .......... Income tax expense.................. Net income... 51,100 27,900 900 27,000 5,400 $ 21,600 Business Publishers ge Chapter 13 13 Analysis and Interpretation of Financial Statement Analysis and interpretation of KATE'S CARDS Balance Sheet August 31, 2019 Assets Current assets Cash......... Accounts receivable.. Inventory.......... Prepaid insurance... Total current assets ..., Equipment ...... Accumulated depreciation ... Total assets ........ $17.400 11,000 16,000 1.000 45,400 17,500 3.250 $59,650 $ 6,200 1,250 1,900 Liabilities Current liabilities Accounts payable........ Unearned revenue ........ Other current liabilities ... Total current liabilities. Note payable ........ Total liabilities Stockholders' equity Common stock .... Additional paid-in-capital .. Preferred stock Retained earnings Total stockholders' equity. Total liabilities and stockholders' equity.... 9,350 15,000 24,350 500 9,500 5,000 20,300 35,300 $59,650 569.650 KATE'S CARDS Statement of Cash Flows Year Ended August 31, 2019 $21,600 3,250 (11,000) (16,000) (1,000) 6,200 1,250 1,900 6,200 Cash flow from operating activities Net income..... Add depreciation...... Increase in accounts receivable Increase in inventory... Increase in prepaid expenses..... Increase in accounts payable.... Increase in unearned revenue Increase in other current liabilities .... Cash provided by operating activities. ... Cash flow from investing activities Purchase of equipment. . . . . . . . . Cash used by investing activities ...... Cash flow from financing activities Proceeds from bank note .. Issuance of common stock... Issuance of preferred stock. ... Cash dividends Cash provided by financing activities... Net increase in cash Cash at beginning of year. ............ Cash at end of year ................. (17,500) (17,500) 15,000 10,000 5,000 (1,300) 28,700 17,400 $17,400 "Kate issued cash dividends on both the common stock and the preferred stock. There are 50 preferred shares outstanding and 500 common shares outstanding. The dividends that Kate paid were $6 per share on the preferred shares and $2 per share on the common shares