Accounting Financial Statements

I just need my assignment reviewed for accuracy, please.

Now that you have prepared the  adjusting and closing entries, Smith  Manufacturing, Inc. has asked that you  prepare a classified Balance  Sheet, a multiple-step Income Statement, and Cash  Flow Statement using  the indirect method. Use your ending numbers from last  week’s  assignment. The prior-year trial balance was included in a separate tab   in the spreadsheet you downloaded last week. You will need these  numbers to  prepare the Statement of Cash Flows. Prepare your financial  statements in  Excel.
 

Trial Balance

– Current Year

Trial Balance

50,000

(due in 10 months, 5%)

500,000

150,000

Smith Manufacturing, Inc.

December 31, 20XX

DR

CR

Cash

362,750

Accounts receivable

320,750

Allowance for uncollectible accounts

1

5,000

Prepaid insurance

10,000

Inventory

30,000

Land

50,000

Building

150,000

Accumulated depreciation-building

7,500

Equipment

500,000

Accumulated depreciation-equipment

Accounts payable

105,000

Note payable

125,000

Salaries payable

Interest payable

Note payable (due in 5 years, 3%)

Common Stock (3,000 shares outstanding)

300,000

Retained earnings

171,000

Sales revenue

850,000

Cost of goods sold

550,000

Salaries expense

Insurance expense

Depreciation expense

Interest expense

Bad debt expense

Totals

2,1

23,500

2,123,500

Trial Balnce – Prior Year

Smith Manufacturing, Inc.

December 31, 20XX
DR CR

Cash

Accounts receivable

Allowance for uncollectible accounts

Prepaid insurance 5,000
Inventory

Land 50,000
Building 150,000
Accumulated depreciation-building 7,500
Equipment 500,000
Accumulated depreciation-equipment 50,000

Accounts payable

Note payable 50,000
Salaries payable 5,000
Interest payable

Note payable (due in 5 years, 3%)

Common Stock (3,000 shares outstanding) 300,000
Retained earnings 171,000

Sales revenue
Cost of goods sold
Salaries expense

Insurance expense
Depreciation expense
Interest expense
Bad debt expense

Totals

1,025,750

	Post-Closing Trial Balance
		15,000
225,750
20,000
80,000
55,000
17,250
350,000
	1,025,750

Answer

DR

CR 8,500

DR

CR 2,000

)

Inventory DR 10,000

CR 10,000

-30,000)

DR

CR 7,500

CR 50,000

DR

CR 21,250

DR 2,000

CR 2,000

Trial Balance DR CR DR CR DR CR
Cash 362,750 362,750

320,750 320,750

Allowance for Uncollectible Accounts 15,000 8,500 23,500
Prepaid Insurance 10,000 2,000 8,000
Inventory 30,000 10,000 40,000
Land 50,000 50,000
Building 150,000 150,000
Accumulated depreciation-building 7,500 7,500 15,000
Equipment 500,000 500,000
Accumulated depreciation-equipment 50,000 50,000

Accounts payable 105,000 105,000

125,000 125,000

Salaries payable 2,000 2,000
Interest payable 21,250 21,250
Note payable (due in 5 years, 3%) 500,000 500,000

300,000 300,000

Retained earnings 171,000 171,000
Sales revenue 850,000 850,000
Cost of goods sold 550,000 10,000

Salaries expense 150,000 2,000

Insurance expense 2,000 2,000
Depreciation expense 57,500 57,500
Interest expense 21,250 21,250
Bad debt expense 8,500 8,500
2,123,500 2,123,500

101,250

2,212,750

Smith Manufacturing, Inc.
Post-Closing Trial Balance
December 31, 20XX
DR CR
Cash 362,750
Accounts receivable 320,750

Allowance for uncollectible accounts 23,500
Prepaid insurance 8,000
Inventory 40,000

Land 50,000
Building 150,000
Equipment 500,000

Accumulated depreciation-building 15,000
Accumulated depreciation-equipment 100,000

Accounts payable 105,000
Note payable (due in 10 months, 5%) 125,000

Salaries payable 2,000
Interest payable 21,250

Note payable (due in 5 years, 3%) 500,000
Common Stock (3,000 shares outstanding) 300,000

Retained earnings

Totals

1,431,500

Adjusting Entries

Bad Debt Expense

8,500

Allowance for Uncollectible Accounts

(850,000 x 1%)

Insurance Expense

2,000

Prepaid Insurance

(10,000-

8,000

Cost of Goods Sold

(

40,000

Depreciation Expense

57,500

Accumulated Depreciation-Building

Accumulated Depreciation-Equip.

Building (150,000/20)

Equipment (500,000/10)

Interest Expense

21,250

Interest Payable

(125,000 x 5%) + (500,000 + 3%)

Salary Expense

Salary Payable

Unadjusted Balance

Adjusted Entries

Closing Balance

Accounts Receivable

100,000

Note payable (due in 10 months, 5%)

Common Stock (3,000 shares)

540,000

152,000

101,250

2,212,750

239,750

1,431,500

– 0

Closing Entries

Sales revenue

$ 850,000

Dec. 31 Income Summary

Cost of goods sold 540,000
Salaries expense 152,000
Insurance expense 2,000
Depreciation expense 57,500
Interest expense 21,250

8,500

Dec. 31 Income Summary

68,750

Closing Entries
Date	Account Title and Description	Dr.	Cr.
		Dec. 31		$ 850,000
		Income Summary
To close sales revenue to income summary
781,250
Bad debts expense
To close expenses to income summary
	68,750
Retained Earnings
To close income summary to retained earnings ( balance equals net income)

Trial Balance

– Current Year

Trial Balance

50,000

(due in 10 months, 5%)

500,000

150,000

2,123,500

Smith Manufacturing, Inc.

December 31, 20XX

DR

CR

Cash

362,750

Accounts receivable

320,750

Allowance for uncollectible accounts

1

5,000

Prepaid insurance

10,000

Inventory

30,000

Land

50,000

Building

150,000

Accumulated depreciation-building

7,500

Equipment

500,000

Accumulated depreciation-equipment

Accounts payable

105,000

Note payable

125,000

Salaries payable

Interest payable

Note payable (due in 5 years, 3%)

Common Stock (3,000 shares outstanding)

300,000

Retained earnings

171,000

Sales revenue

850,000

Cost of goods sold

550,000

Salaries expense

Insurance expense

Depreciation expense

Interest expense

Bad debt expense

Totals

2,123,500

Trial Balnce – Prior Year

Smith Manufacturing, Inc.

December 31, 20XX
DR CR

Cash

Accounts receivable

Allowance for uncollectible accounts

Prepaid insurance 5,000
Inventory

Land 50,000
Building 150,000
Accumulated depreciation-building 7,500
Equipment 500,000
Accumulated depreciation-equipment 50,000

Accounts payable

Note payable 50,000
Salaries payable 5,000
Interest payable

Note payable (due in 5 years, 3%)

Common Stock (3,000 shares outstanding) 300,000
Retained earnings 171,000

Sales revenue
Cost of goods sold
Salaries expense

Insurance expense
Depreciation expense
Interest expense
Bad debt expense

Totals

1,025,750

Post-Closing Trial Balance
15,000
	225,750
20,000
	80,000
55,000
	17,250
		350,000
	1,025,750

STATEMENT CASH FLOW

Smith Manufacturing, Inc.

Inventory

Accounts payable 50,000
Salaries payable (3,000)

150,000

15,000

Statement of Cash Flows
		For Year Ending Dec 31, 20XX
	Retained Earnings		$ 68,750
Non Cash Expenses (+)
Depreciation		57,500
Interest expense			21,250
Net profit before working capital changes	$ 147,500
	40,000
Short term notes payable	75,000
	Interest Payable	4,000
less Accounts Receivable	(91,500)
	Prepaid Insurance		(3,000)
Cash from Operating Activities- A	$ 219,000
Cash from Investing Activities- B
Long term Notes payable
Less Interest expense	(21,250)
Cash from Financing Activities- C	$ 128,750
Cash Balance	$ 347,750
Add Opening Balance of Cash
Closing Balance of cash		$ 362,750

INCOME STATEMENT

Smith Manufacturing, Inc.

For Year Ending Dec 31, 20XX

2,000

57,500

21,250

Net Income $ 68,750

	Multiple-step Income Statement
Sales Revenue	$ 850,000
less Cost of Goods Sold	(540,000)
Gross profit	$ 310,000
Less expenses:
Salaries expense	15		2,000
Insurance expense
Depreciation expense
Bad Debts expense	8,500
Total expenses	$ 220,000
	Net Income	$ 90,000
less Interest expense

BALANCE SHEET

Smith Manufacturing, Inc.
Multiple-step Income Statement
For Year Ending Dec 31, 20XX

Cash

$ 362,750

Accounts receivable 225,750 320,750
Prepaid Insurance 5,000

Inventory 80,000 40,000
Land

$ 50,000

Building 150,000 150,000
Equipment 500,000 500,000
Accounts payable

50,000 125,000

5,000 2,000

Interest Payable 17,250 21,250

350,000 500,000

350,000 500,000

300,000 300,000

Retained Earnings 171,000

$ 948,250 $ 1,293,000

Assets	Prior YR	Current YR
$ 15,000
Less Allowance for doubtful Debts	(20,000)	(23,500)
Net Accounts Receivable	205,750	297,250
8,000
Total Current Assets	$ 305,750	$ 708,000
	$ 50,000
Less Accumulated Depreciation on Building	(7,500)	(15,000)
Net Building	142,500	135,000
Less Accumulated Depreciation on Equipment	(50,000)	(100,000)
Net Equipment	450,000	400,000
Total Fixed Assets	642,500	585,000
Total Assets		$ 948,250		$ 1,293,000
Current Liabilities
$ 55,000	$ 105,000
Notes Payable (Short term )
Salaries Payable
Total Current Liabilities	127,250	253,250
Notes Payable (long term )
Total Long term Liabilities
Common stock
239,750
Total Liabilities and Equity