The following information for the year ended December 31, 2021, was reported by Nice Bite, Incorporated Accounts Payable Accounts Receivable Cash (balance on January 1, 2021) Cash (balance on December 31, 2021) Common Stock Dividends Equipment Income Tax Expense Interest Expense Inventory Notes Payable Office Expense Prepaid Rent Retained Earnings (beginning) Salaries and Wages Expense Service Revenue Utilities Expense Salaries and Wages Payable Other cash flow information: Cash from issuing common stock Cash paid to reacquire common stock Cash paid for income taxes Cash paid to purchase long-term assets Cash paid to suppliers and employees Cash received from customers Required: 1. Prepare an income statement for 2021. $ 47,000 24,800 94,900 82,000 154,000 0 138,700 10,300 29,700 17,400 25,700 14,500 7,200 7,300 35,900 141,800 25,300 10,000 $ 23,000 25,700 11,200 54,400 85,600 141,000
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.
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Required information
[The following information applies to the questions displayed below.]
The following information for the year ended December 31, 2021, was reported
by Nice Bite, Incorporated
Accounts Payable
Accounts Receivable
Cash (balance on January 1, 2021)
Cash (balance on December 31, 2021)
Common Stock
Dividends
Equipment
Income Tax Expense
Interest Expense
Inventory
Notes Payable
Office Expense
Prepaid Rent
Retained Earnings (beginning)
Salaries and Wages Expense
Service Revenue
Utilities Expense
Salaries and Wages Payable
Other cash flow information:
Cash from issuing common stock
Cash paid to reacquire common stock.
Cash paid for income taxes
Cash paid to purchase long-term assets
Cash paid to suppliers and employees
Cash received from customers
Required:
1. Prepare an income statement for 2021.
NICE BITE, Incorporated
Income Statement
0
0
$ 47,000
24,800
94,900
82,000
154,000
0
138,700
10,300
29,700
17,400
25,700
14,500
7,200
7,300
35,900
141,800
25,300
10,000
$ 23,000
25,700
11, 200
54,400
85,600
141,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F67eeef0b-e6a8-43af-a851-bbb71fd1c3af%2F68dcb6e0-b3c0-4362-97a5-b09c6d54bc7c%2Fbkfxdqr_processed.jpeg&w=3840&q=75)
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