YOUR COMPANY
Income Statement
For the year ended January 31, 2019
Sales revenue (net)		55,432
Cost of goods sold		-9,778
Gross profit		45,704
Operating expenses:
Selling expenses	2,598
General & administrative expenses	25,869
Depreciation expense	8,548
Total operating expenses		38,015
Operating Income		9,089
Other items:
Interest expense	-3,253
Loss on sale of equipment	625	3,878
Net Income		4,811

YOUR COMPANY
Statement of Cash Flows
For the year ended January 31st, 2019
Cash Flows from Operating Activities
Net Income
Adjustments for noncash effects:
Depreciation expense
Bad debt expense
Loss on sale of equipment
* Changes in current assets and current liabilities:
Increase/Decrease in accounts receivable
Increase/Decrease in inventory
Increase/Decrease in supplies
Increase/Decrease in prepaid insurance
Increase/Decrease in prepaid rent
Increase/Decrease in prepaid advertising
Increase/Decrease in accounts payable
Increase/Decrease in interest payable
Increase/Decrease in salaries payable
Net cash flows for operating activities
Cash Flows from Investing Activities
Purchase of equipment
Proceeds from sale of equipment
Net cash flows for investing activities
Cash Flows from Financing Activities
Issuance of common stock
Proceeds from notes payable
Payment of dividends
Net cash flows from financing activities
Net increase in cash
Beginning cash balance, Jan. 1
Ending cash balance, December 31st

Units Unit Cost 300 25 January 1st February 8th March 1st March 31st April 1st April 10th Mar 15th May 30th June 1st June 30th 300 38 Tul 25th Common stock is issued in exchange for cash in the amount of ....................... ............. 350,000 The company purchases and pays for 300 units of computer replacement parts at a price of $25 per unit ........ 7,500 The company pays cash for a one-year insurance policy in the amount of ........... ....................... 10,752 Rent on a retail space for 12 months is paid in the amount of ........... 10,512 Diagnostic tools and testing equipment with a useful life of 2 years is purchased for cash in the amount of ...... 23,460 PC tuning supplies purchased on account in the amount of ... 4,250 The company purchases and pays for another 300 units of computer replacement parts at a price of $38 per uni 11,400 PC repair services are performed on account in the amount of ........... ............. 10,538 The company pays for advertisements to be run for the next 12 months in the amount of ...................... 1,540 The company issues a 5-year notes payable with their bank for $100,000 and interest at an annual rate of 8%. Interest is due on June 30th each year and the principal vill be paid is full at the end of the 5 year period 100,000 Software installation & upgrade services are performed on account in the amount of 10,759 120 units of computer replacement parts are sold for $75 per unit with terms 2/10, n/30. The sale is recorded using the gross method in the amount of (see note c for cost flow assumptions) .. 9,000 Hardware replacement services are provided on account in the amount of .............................. 9,820 The company receives full payment from the customer for the July 31st sale ............... 8,820 Virus removal services are performed on account in the amount of .......... 6,295 Customer payments are received for services previously provided in the amount of .... 1,520 136 units of computer replacement parts are sold for $75 per unit with terms 2/10,n/30. The sale is recorded using the gross method in the amount of ..... 10,200 The company receives payment for half of the October 13th sale ......... ...................................... 5,100 Equipment originally purchased on April 1st for $3,000 is sold for $1,500 cash A bookkeeper is hired to help the company with daily accounting taxes and annual tax preparation The bookkeeper is paid $4,500 for the previous month's services 4,500 July 31st -120 3 8 August 2nd August 6th September 15th September 29th October 13th -136 38 October 29th November 1st November 15th December 15th Additional information: a. PC tuning supplies on hand at the end of the month are as follows: 2,550 b. The year-end balance reported at the end of the year for the Allowance for Doubtful Accounts is estimated as 2.5% of outstanding receivables at the end of the year c. The Company uses a perpetual inventory system and accounts for costs using the Last-In-First-Out cost flow assumption. On December 31st, a count of ending inventory reveals that there are 344 units of computer replacement parts on hand d. All revenue is recorded in the "Sales Revenue" account and reported net of cash discounts on the income statement. e. The effective interest method is used to amortize bond premiums and discounts f. Adjustments are made at the end of the year for prepaid insurance, rent, advertising, depreciation, and interest expense. g. The bookkeeper is paid a salary of $4,500 on the 15th of every month. h. The company declared dividends of $700 for the year i. Assume selling expenses include advertising and supplies expense. All other expenses, other than depreciation and interest expense, are considered general & administrative. Cash Insurance Expense Credit Debit Common Stock Credit Beginning Balance S $350,000 Ending Balance $350,000 Debit Beginning Halance S $ $ Ending Balance Debalt Beginning balance Jan 1 Jun 30 Ava 6 Sap 29 Oct 29 Nav 1 8,960 8,960 S $350,000 Feb 3 $109,425 Mar 1 $ 8,820 Mar 31 S 1.520 Apr 1 $ 5.100 May 15 S 1,30 Jun 1 Dec 15 $405,701 $ 7,500 $ 14,/92 $ 10,512 $ 23,410 $ 11100 $ 1,340 $ 1.500 Rent Expense Deblt Debit Credit Beginning walance Sales Revenue Credit Beginning balance $ Jul 31 $ 9,000 Oct 13 $14,200 Ending Balance $ 19,200 S $ $ 7.784 7,784 Ending Balance Ending Balance Accounts Receivable Credit Credit Debit Beginning walance May 30 Debit $ $ $ 9,000 1.520 5,100 Advertising Expense Dellt Beginning Halance $ $ 898 Ending Balance $ 898 Service Revenue Credit Deginnine Balance May 3D Jul 25 S Aug $ 10,538 Sep 29 S 10,259 Oct 29 $ 9,000 S 9,820 $ 6,295 S 10.200 Jul 31 $ . $ 10,538 $ 10,759 $ 9,820 $ 5,295 $ 37,412 Depreciation Expense ALE 2 5ep 15 Let 13 Sep 15 Ending Balance Credit Dellt Beginning Halance S $ $ Ending Balance $ 40,992 Sales Discount Ending Balance 853 853 Credit Inventory Dividend Debit Beginning Halance Aves Ending Balance Credit S $ $ Credit 160 180 Debit Beginning Halance Debit Beginning Balance feb 3 May 15 Ending Balance $ 4,50 $ 5,168 S Jul 21 $ 7,500 Od 13 $ 11,400 $ 9,172 S $ $ 700 700 Salaries Expense Ending Balance Credit Debit Beginning Halance $ Des 15 $ Debit Bond Payable Credit Heginning walance Credit Supplies Debit Besimir Balance 5 - Apr 10 S4,250 Ending Balance $ 2,550 4.500 45 9,000 $ 1,700 Ending Balance $ S $ $ 700 700 Ending Balance Loss on Disposal Credit Prepaid Rent $ . Debit Beginninu Dalance Nav1 Ending Balance Credit $ 7,784 $ 625 Debit Besimir Dalance Mar 31 Ending Balance $ . $ 1.512 $ 2,728 Credit Depreciation Expense Debit Deminniru Oulate $ . Nav 1 S X75 Ending Balance $ 875 Prepaid Insurance Debit Desimir Dalance $ - Mar 1 S 10,792 Ending Balance $ 1,792 Credit $ 8,960 Cost of Sales Credit Prepaid Advertising Credit Debit Desintir Dalance Jul 31 Oct 1) Ending Balance $ . S4,56 $ 5,168 $ 9,728 Debit Beginninu Dalance Jun 1 Ending Balance $ 898 $ $ $ 1,541 642 Equipment Credit Credit Supplies Expense Debit Heginning Halance $ $ 1,700 Ending Balance $ 1,700 3 Debit Bezirinin, Balance Apr 1 Ending Balance ,000 Nov 1 S 23,41 $ 20,460 Credit Bad Debt Expense Debit Heginnine Halange S $ 1,025 Ending Balance $ 1,025 Accumulated Depreciation Debit Credit 5 875 Dezinning Dalance $ Nov 1 S Ending Balance $ Nov 1 . 875 . Allowance for Dooubtful Accounts Debit Credit Heginning Balance Debit Accounts Payable Credit Deginnir: Dalance Apr 10 Ending Balance $ $ $ - 4,750 4,250 S $ $ Ending Balance 1,025 1,025 Premium on Bond Debit Credit Debit S Bond Payable Credit Deginning Dalance Jun 30 Ending Balance $ . $10X100X $100,000 747 Heginning Halanca Jun 30 Ending Balance S $ $ 3,425 7,678 Credit Debit Interest Expense Debit Haginnine Halance S S2.253 Ending Balance $ 3,253 Dec 15 Salarles Payable Credit 4.500 Dezinning Dalance $ Dec 15 S $ Ending Balance $ $ . 4,500 4.500 4,500 Debit Interest payable Credit Heginning Ralanca $ $ Ending Balance $ 4,000 4,000