For the Year Ending 12/31/2013
|
Sales Revenue
|
|
100,000
|
|
Less Cost of Goods Sold
|
|
-60,000
|
|
Equals Gross Margin
|
|
40,000
|
|
Operating Expenses
|
|
|
|
Selling and Administration
|
15,000
|
|
|
Depreciation
|
7,000
|
|
|
Total Operating Expense
|
|
-22,000
|
|
Operating Income
|
|
18,000
|
|
Tax
|
|
-7,200
|
|
Net Income
|
|
10,800
|
Eric and Ian
Statement of Retained Earnings
For the Year Ending 12/31/2013
|
Beginning Balance
|
|
10,000
|
|
Net Income
|
|
10,800
|
|
Less Dividends
|
|
-3,400
|
|
Ending Balance
|
|
17,400
|
Eric and Ian
Balance Sheet
12/31/2012 & 12/31/2013
|
Category
|
2012
|
2013
|
|
Cash
|
20,000
|
25,000
|
|
Accounts Receivable
|
15,000
|
12,000
|
|
Inventory
|
30,000
|
52,000
|
|
Total Current Assets
|
65,000
|
89,000
|
|
Equipment
|
70,000
|
65,000
|
|
Less Accumulated Depreciation
|
-15,000
|
-19,000
|
|
Equipment (Net)
|
55,000
|
46,000
|
|
Total Assets
|
120,000
|
135,000
|
|
|
|
|
Accounts Payable
|
15,000
|
29,000
|
|
Long-term Liabilities
|
25,000
|
18,600
|
|
Total Liabilities
|
40,000
|
47,600
|
|
|
|
|
Common Stock
|
70,000
|
70,000
|
|
Retained Earnings
|
10,000
|
17,400
|
|
Total Equity
|
80,000
|
87,400
|
|
Total Liabilities & Equity
|
120,000
|
135,000
|
Shares of Stock Outstanding 2,000 2,000
Market Price per Share Common Stock 7.00 8.00
Question A: cash flow
to develop a cash flow statement for 2013.
Question B : Ratio Analysis
Use the financial information from Eric and Ian Company to compute any three activity ratios, any one liquidity ratio, any one debt ratio, any three profitability ratios, and any two market ratios.