The Martins know that setting up some projected Income Statements are important. They need to look at what the first year of operations might look like and if possible they will need to look at the years thereafter to get an impression of what the long term might look like. RM Purchases: $132,000* (Raw Material Purchases is a part of COGS) Sales Salaries: 80,000 Advertising: 3,000 Travel: 2,000 Revenue: 360,000 Financing Costs: 10,000 Office Lease: 13,000 Depreciation: 38,000 Income Taxes: 22,000 Admin Salary: 40,000 A second financial statement that is key to understanding a business is the Balance Sheet. The Martins have estimated the following accounts to be a part of their initial Balance Sheet. Trade Receivables: $35,000 Cash: 15,000 Short Term Loan: 30,000 Share Capital: 100,000 Long Term Liabilities: 60,000 Property, Plant: 170,000 Prepaid Expenses: 5,000 Yearly LTD Retirement: 5,000 Retained Earnings: 25,000 Accumulated Dep’n: 38,000 Current Payables: 17,000 Inventories: 50,000 Q1: With the above accounts, prepare CompuTech’s Income Statement for the year ended, December 31, 2021. Q2: With the above accounts, prepare CompuTech’s Balance Sheet as at December 31, 2021. Q3: Which of the above accounts are FIXED, and which are VARIABLE? Q4: What is the COGS for the year 2021?
The Martins know that setting up some
RM Purchases: $132,000* (Raw Material Purchases is a part of COGS)
Sales Salaries: 80,000
Advertising: 3,000
Travel: 2,000
Revenue: 360,000
Financing Costs: 10,000
Office Lease: 13,000
Income Taxes: 22,000
Admin Salary: 40,000
A second financial statement that is key to understanding a business is the Balance Sheet. The Martins have estimated the following accounts to be a part of their initial Balance Sheet.
Trade Receivables: $35,000
Cash: 15,000
Short Term Loan: 30,000
Share Capital: 100,000
Long Term Liabilities: 60,000
Property, Plant: 170,000
Prepaid Expenses: 5,000
Yearly LTD Retirement: 5,000
Accumulated Dep’n: 38,000
Current Payables: 17,000
Inventories: 50,000
Q1: With the above accounts, prepare CompuTech’s Income Statement for the year ended, December 31, 2021.
Q2: With the above accounts, prepare CompuTech’s Balance Sheet as at December 31, 2021.
Q3: Which of the above accounts are FIXED, and which are VARIABLE?
Q4: What is the COGS for the year 2021?
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