Prepare a balance sheet and income statement from the following data as of, and for the year ended December 31, 2011 :
Inventory $5,096
Sales 4,312
Accounts payable 2,146
Plant & equipment 20,091
Depreciation 1,000
Cash 2,155
Cost of goods sold 1,569
Accounts receivable 3,142
Notes payable-due 3/31/12 382
Administrative expenses 274
Common stock ?
Notes payable- due 1/1/15 8,232
Interest expense 309
Accumulated depreciation 2,000
Tax rate 35%
Retained earnings-as of 12/31/10 1,769

Can you please explain to me how to get common stock and retained earnings(2011). I'm suppose to create balance sheet & income statement for 2010 and 2011.



I have a hard time uploading the document but here is what I got so far sorry for the bad editing

Income Statement
Category 2011 2010
Sales 4,312 4,312
CGS 1,569 1,569
Gross 2,743 2,743
G & A exp 274 274
Depreciation 1,000 1,000
EBIT 1,469 1,469
Interest Expenses 309 309
Earning Before Taxes 1,160 1,160
Taxes 406 406
Net Income 754 754

Tax Rate:
35%

Balance Sheet
Cash 2,155 2,155
Accounts Receivable 3,142 3,142
Inventory 5,096 5,096
Total Current Assets 10393 10,393
Buildings & Equipment 20,091 20,091
Accumulated depreciation 2,000 2,000
Net Fixed Assets 18,091 18,091
Total Assets 28,484 28,484
Liabilities and Owners Equity
Accounts Payable 2,146 2,146
Notes Payable 382 0
Total Current Liabilities 2,528 2,146
Long Term Debt 8,232 8,232
Total Liablities 10,760 10,378
Common Stock 1,508 0
Retained Earnings 1,015 1,769
Total Shareholder's Equity 2,523 1,769
Total Liabilities and Owners Equity 13,283 12,147

I do need help too with calculating the balance sheet/ income statement

From what's posted, there's no way to determine what the Dec 31 2010 balance sheet or income statement looked like. It's a safe bet, though, that the numbers weren't simply identical to their corresponding amounts on the Dec 31 2011 statements.

As far as your Dec 31 2011 statements, your income statement looks correct top to bottom.

Your Dec 31 2011 balance sheet is correct through the assets and liabilities, but comes unglued a bit in the equity area.

You are given that retained earnings stood at 1,769 as of Dec 31 2010. Further, you've correctly computed that the 2011 after-tax net income is a positive 754. Hence, retained earnings at Dec 31 2011 should be the sum of those two amounts. You've inadvertently deducted the 2011 net profit from beginning-of-2011 retained earnings.

Make that fix, then finally the Dec 31 2011 common stock balance will be whatever amount is necessary to make the balance sheet, well, balance.

Quote:

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Originally Posted by ArcSine

From what's posted, there's no way to determine what the Dec 31 2010 balance sheet or income statement looked like. It's a safe bet, though, that the numbers weren't simply identical to their corresponding amounts on the Dec 31 2011 statements.

As far as your Dec 31 2011 statements, your income statement looks correct top to bottom.

Your Dec 31 2011 balance sheet is correct through the assets and liabilities, but comes unglued a bit in the equity area.

You are given that retained earnings stood at 1,769 as of Dec 31 2010. Further, you've correctly computed that the 2011 after-tax net income is a positive 754. Hence, retained earnings at Dec 31 2011 should be the sum of those two amounts. You've inadvertently deducted the 2011 net profit from beginning-of-2011 retained earnings.

Make that fix, then finally the Dec 31 2011 common stock balance will be whatever amount is necessary to make the balance sheet, well, balance.

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What do you mean by making balance sheet well balance? I don't know how to calculate common stock can you help for both 2011 & 2010? My teacher expects us to teach are selves

When I summed up retained earnings for Dec 2011 I got 2,523 is that correct?

Thanks for your time

Yes, Retained Earnings for Dec 31 2011 is 2,523.

Now on your Dec 31 2011 balance sheet you have
Total Assets = 28,484
Total Liabilities = 10,760

As far as Total Shareholders' Equity, you know that it must be 28,484 - 10,760 = 17,724.
You also know that Retained Earnings is 2,523.
Then the correct balance for Common Stock is whatever amount, which when added to 2,523, makes Total Shareholders' Equity equal to its necessary amount.

Regarding Common Stock at Dec 31 2010, about the only thing we can say is that it was probably the same balance as it was at Dec 31 2011. This is because the 2011 information says nothing about the issuance of new shares, or the retirement of existing shares.