Question

Use the following information to create the financial statements in questions 1-3. Unless otherwise specified, the data given are for the fiscal year 2019 as of Dec. 31. Credit will not be given unless complete financial statements are submitted.

Sales revenue: $8,000	Accounts Receivable Dec. 31, 2019: $150
Tax rate: 25%	Accounts Payable Dec. 31, 2019: $175
Interest expense: $70	Inventory Dec. 31, 2019: $800
SGA Expenses: $1,300	Total Expenses: $5,200
Other Revenue: $2,000	Accrued Liabilities: $550
R&D Expense: $500	Long-Term Debt: $700
Cash on Dec. 31, 2018: $900	Long-Term Debt Currently Due: $50
Accounts Receivable Dec. 31, 2018: $300	Common Stock: $5,300
Accounts Payable Dec. 31, 2018: $750	Property Plant and Equipment: $1,750
Inventory Dec. 31, 2018: $200	Patents: $475
Cost of Goods Sold: ______	Retained Earnings: ______

1. Create an income statement for the year ended Dec. 31, 2019. To complete the income statement you will need to calculate total revenue, cost of goods sold, pretax income, income tax expense, and net income.

2. Create a statement of cash flows for the year ended Dec. 31, 2019. Remember that changes in certain balance sheet items over the year will affect the cash flow statement.

3. Create a balance sheet for Dec. 31, 2019. You will need to use the accounting equation to calculate retained earnings

Answer 1

1st and 2nd question has been solved below:

Assumptions:

1. there are no Accrued Liabilities at the begining of the period.

2. Total Expenses include Cost of Goods Sold.

3. Long tem ebt due is paid uring the period

4. There was no ncome tax payable at the begining o th peod.