The income statement for the year ended December 31, 2015, the balance sheets for December 31, 2015 and 2014, and the statement of retained earnings for the year ended December 31, 2015, for Technica, Inc., are given below and on the following page. Briefly discuss the form and informational content of each of these statements.

Transcribed Image Text:

Technica, Inc., Income Statement for the Year Ended December 31, 2015 Sales revenue $600,000 460,000 $140,000 Less: Cost of goods sold Gross profits Less: Operating expenses S 30,000 30,000 S 60,000 S 80,000 10,000 S 70,000 27,100 General and administrative expenses Depreciation expense Total operating expense Operating profits Net profits before taxes Earnings available for common stockholders Less: Interest expense Less: Taxes Earnings per share (EPS) $2.15 Technica, Inc., Balance Sheets December 31 2015 2014 S 16,000 Assets Cash Marketable securities Accounts Inventories S 15,000 7,200 8,000 receivable 34,100 82,000 42,200 50,000 $138,300 $116200 Total current assets Land and buildings Machinery and equipment Furniture and fixtures Other S150,000 200,000 54,000 11,000 $415,000 145,000 $270,000 $408,000 $150,000 190,000 50,000 10,000 $400,000 115,000 $285,000 $401,200 Total gross fixed assets Less: Accumulated depreciation Net fixed assets Total assets Liabilities and Stockholders' Equity Accounts payable Notes payable Accruals S 49,000 16,000 6,000 S 75,000 71,000 $160,000 $120,000 S 57,000 13,000 5,000 Total current liabilities Long-term debt Common stock equity (shares outstanding 150,000 S110,200 19,500 in 2015 and 20,000 in 2014) Retained earnings 73,10050,200 $183,300 $170,200 Total stockholders' equity Total liabilities and stockholders' equity$408,300 Technica, Inc., State ment of Retained Earnings for the Year Ended December 31,2015 Retained earnings balance (January 1, 2015) Plus: Net profits after taxes (for 2015) Less: Cash dividends (paid during 2015) $50,200 42,900 20,000 Retained earnings balance (December 31, 2015)