[The following information applies to the questions displayed below.] South Fitness, Incorporated, reported the following information for the six-month period ended June 29, 2019. Items are listed alphabetically and are in thousands of dollars. Accounts Payable Accounts Receivable Advertising Expense Cash (January 1, 2019) Cash (June 29, 2019) Common Stock Dividends Equipment Income Tax Expense Inventory Notes Payable Office Expense Operating Expenses Retained Earnings (January 1, 2019) Sales Revenue Supplies Other cash flow information: Cash received from issuing common stock Cash paid to purchase equipment Cash paid to suppliers and employees Cash received from customers Cash received from sale of long-term assets Dividends paid to stockholders $ 1,028,700 594,000 70,000 1,384,000 1,070,000 1,525,000 310,000 3,066,000 79,000 649,000 348,300 657,000 694,000 2,726,000 1,730,000 169,000 $ 58,000 530,000 1,432,000 1,716,000 184,000 310,000 Required: 1. Prepare an income statement for the six months ended June 29, 2019. (Enter your answers in thousands.)
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.
![[The following information applies to the questions displayed below.]
South Fitness, Incorporated, reported the following information for the six-month period ended June 29, 2019. Items are
listed alphabetically and are in thousands of dollars.
Accounts Payable
Accounts Receivable
Advertising Expense
Cash (January 1, 2019)
Cash (June 29, 2019)
Common Stock
Dividends
Equipment
Income Tax Expense.
Inventory
Notes Payable
Office Expense
Operating Expenses
Retained Earnings (January 1, 2019)
Sales Revenue
Supplies
Other cash flow information:
Cash received from issuing common stock
Cash paid to purchase equipment
Cash paid to suppliers and employees
Cash received from customers
O Cash received from sale of long-term assets
Dividends paid to stockholders
Revenues
SOUTH FITNESS, Incorporated
Income Statement
Advertising Expense
Net Income
(in thousands)
$
Required:
1. Prepare an income statement for the six months ended June 29, 2019. (Enter your answers in thousands.)
0
0
$ 1,028,700
594,000
70,000
457,000
1,384,000
1,070,000
1,525,000
310,000
3,066,000
79,000
649,000
348,300
657,000
694,000
2,726,000
1,730,000
169,000
$ 58,000
530,000
1,432,000
1,716,000
184,000
310,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe78e1aa3-b968-4289-8bbd-5fb9c4477203%2F822cc79b-0d4a-41ba-ad46-ebc7c74e8974%2Fcep3u7_processed.jpeg&w=3840&q=75)
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