Financial Statements, including Statement of Cash Flows Pendray Systems Corporation began operations on January 1, 20Y5, as an online retailer of computer software and hardware. The following financial statement data were taken from Pendray's records at the end of its first year of operations, December 31, 20Y5. Accounts payable $60,000 Accounts receivable 330,000 Common stock 756,000 Cash ? Cash payments for operating activities 1,971,000 Cash receipts from operating activities 2,070,000 Cost of sales 1,305,000 Dividends 90,000 Income tax expense 159,000 Income taxes payable 24,000 Interest expense 6,000 Inventories 345,000 Note payable (due in ten years) 150,000 Property, plant, and equipment 795,000 Retained earnings ? Sales 2,400,000 Selling and administrative expenses 240,000 Instructions: Question Content Area 1. Prepare an income statement for the year ended December 31, 20Y5. Pendray Systems CorporationIncome StatementFor the Year Ended December 31, 20Y5 Revenues: $- Select - Expenses: $- Select - - Select - - Select - - Select - - Select - $- Select - Question Content Area 2. Prepare a statement of stockholders' equity for the year ended December 31, 20Y5. If your answer is zero, leave it blank. Pendray Systems CorporationStatement of Stockholders' EquityFor the Year Ended December 31, 20Y5 blank Common Stock Retained Earnings Total Balances, January 1, 20Y5 $fill in the blank b12706fb1033043_1 $fill in the blank b12706fb1033043_2 $fill in the blank b12706fb1033043_3 - Select - - Select - - Select - - Select - - Select - - Select - - Select - - Select - - Select - Balances, December 31, 20Y5 $fill in the blank b12706fb1033043_16 $fill in the blank b12706fb1033043_17 $fill in the blank b12706fb1033043_18 Question Content Area 3. Prepare a balance sheet as of December 31, 20Y5. Pendray Systems CorporationDecember 31, 20Y5 Assets $- Select - - Select - - Select - - Select - Total assets $fill in the blank 3989a205303ffa4_9 Liabilities $- Select - - Select - - Select - Total liabilities $fill in the blank 3989a205303ffa4_16 Stockholders' Equity $- Select - - Select - Total stockholders' equity fill in the blank 3989a205303ffa4_21 Total liabilities and stockholders' equity $fill in the blank 3989a205303ffa4_22 Question Content Area 4. Prepare a statement of cash flows for the year ended December 31, 20Y5. Use the minus sign to indicate cash outflows, decreases in cash, or cash payments. If your answer is zero, leave it blank. Pendray Systems CorporationStatement of Cash FlowsFor the Year Ended December 31, 20Y5 Cash flows from (used for) operating activities: $- Select - - Select - $- Select - Cash flows used for investing activities: - Select - Cash flows from (used for) financing activities: $- Select - - Select - - Select - - Select - $- Select - - Select - $- Select -
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.
Financial Statements, including Statement of
Pendray Systems Corporation began operations on January 1, 20Y5, as an online retailer of computer software and hardware. The following financial statement data were taken from Pendray's records at the end of its first year of operations, December 31, 20Y5.
| Accounts payable | $60,000 |
| 330,000 | |
| Common stock | 756,000 |
| Cash | ? |
| Cash payments for operating activities | 1,971,000 |
| Cash receipts from operating activities | 2,070,000 |
| Cost of sales | 1,305,000 |
| Dividends | 90,000 |
| Income tax expense | 159,000 |
| Income taxes payable | 24,000 |
| Interest expense | 6,000 |
| Inventories | 345,000 |
| Note payable (due in ten years) | 150,000 |
| Property, plant, and equipment | 795,000 |
| Retained earnings | ? |
| Sales | 2,400,000 |
| Selling and administrative expenses | 240,000 |
Instructions:
Question Content Area
1. Prepare an income statement for the year ended December 31, 20Y5.
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Question Content Area
2. Prepare a statement of
| blank | Common Stock | Retained Earnings | Total |
| Balances, January 1, 20Y5 | $fill in the blank b12706fb1033043_1 | $fill in the blank b12706fb1033043_2 | $fill in the blank b12706fb1033043_3 |
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| Balances, December 31, 20Y5 | $fill in the blank b12706fb1033043_16 | $fill in the blank b12706fb1033043_17 | $fill in the blank b12706fb1033043_18 |
Question Content Area
3. Prepare a
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| Total liabilities | $fill in the blank 3989a205303ffa4_16 | |
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| Total stockholders' equity | fill in the blank 3989a205303ffa4_21 | |
| Total liabilities and stockholders' equity | $fill in the blank 3989a205303ffa4_22 |
Question Content Area
4. Prepare a statement of cash flows for the year ended December 31, 20Y5. Use the minus sign to indicate
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