Comparative Income Statements For Years Ended December 31, 2019, 2018, and 2017 2019 2018 2017 Sales $ 503,168 $ 385,468 $ 267,500 Cost of goods sold Gross profit Selling expenses Administrative expenses 244,772 302,907 200,261 171,200 96,300 140,696 53,195 33,921 87.116 71,450 45,285 35,310 22,203 57.513 Total expenses Income before taxes 116,735 83.526 83,526 15,536 57,513 38,787 7,874 53,580 Income tax expense 10,984 Net income $ 67,990 $ 42,596 $ 30,913 KORBIN COMPANY Comparative Balance Sheets December 31, 2019, 2018, and 2017 2019 2018 2017 Assets $ 63,122 $ 42,248 $ 56,475 4,910 61, 507 $ 148,331 $ 122,892 Current assets Long-term investments Plant assets, net 800 115,440 105, 283 Total assets $ 178,562 Liabilities and Equity $ 26,070 $ 21,506 $ 22,101 68,000 8,500 Current liabilities Common stock Other paid-in capital Retained earnings 68,000 50,000 8,500 5,556 45,830 $ 122,892 75,992 49,730 Total liabilities and equity $ 178,562 $ 148,331 2. Complete the below table to calculate income statement data in common-size percents. (Round your percentage answers to 2 Hecimal places.) KORBIN COMPANY Common-Size Comparative Income Statements For Years Ended December 31, 2019, 2018, and 2017 2019 2018 2017 Sales % % % Cost of goods sold Gross profit Selling expenses Administrative expenses Total expenses Income before taxes Income tax expense Net income % % %
Reporting Cash Flows
Reporting of cash flows means a statement of cash flow which is a financial statement. A cash flow statement is prepared by gathering all the data regarding inflows and outflows of a company. The cash flow statement includes cash inflows and outflows from various activities such as operating, financing, and investment. Reporting this statement is important because it is the main financial statement of the company.
Balance Sheet
A balance sheet is an integral part of the set of financial statements of an organization that reports the assets, liabilities, equity (shareholding) capital, other short and long-term debts, along with other related items. A balance sheet is one of the most critical measures of the financial performance and position of the company, and as the name suggests, the statement must balance the assets against the liabilities and equity. The assets are what the company owns, and the liabilities represent what the company owes. Equity represents the amount invested in the business, either by the promoters of the company or by external shareholders. The total assets must match total liabilities plus equity.
Financial Statements
Financial statements are written records of an organization which provide a true and real picture of business activities. It shows the financial position and the operating performance of the company. It is prepared at the end of every financial cycle. It includes three main components that are balance sheet, income statement and cash flow statement.
Owner's Capital
Before we begin to understand what Owner’s capital is and what Equity financing is to an organization, it is important to understand some basic accounting terminologies. A double-entry bookkeeping system Normal account balances are those which are expected to have either a debit balance or a credit balance, depending on the nature of the account. An asset account will have a debit balance as normal balance because an asset is a debit account. Similarly, a liability account will have the normal balance as a credit balance because it is amount owed, representing a credit account. Equity is also said to have a credit balance as its normal balance. However, sometimes the normal balances may be reversed, often due to incorrect journal or posting entries or other accounting/ clerical errors.
2. Complete the below table to calculate income statement data in common-size percents. (Round your percentage answers to 2 decimal places.)
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