Question

(Working with an income statement and balance sheet) Prepare a balance sheet and income statement for Belmond, Inc. from the following information.

3-5. (Working with an income statement and balance sheet) Prepare a balance sheet and income statement for Belmond, Inc. from the following information. Inventory $6,500 Common stock 45,000 Cash 16,550 Operating expenses 1,350 Short-term notes payable 600 Interest expense 900 Depreciation expense 500 Net sales 12,800 Accounts receivable 9,600 Accounts payable 4,800 Long-term debt 55,000 Cost of goods sold 5,750 Buildings and equipment 122,000 Accumulated depreciation 34,000 Taxes 1,440 General and administrative expense 850 Retained earnings

Answer 1

Income statement for Belmond Inc is shown below
Income statement
Belmond Inc
Net sales	$12,800
Less: Cost of goods sold	$5,750
Gross profit	$7,050
Less: Operating expenses	$1,350
General and administrative expenses	$850
Depreciation expense	$500
Operating profit	$4,350
Less: Interest	$900
Profit before taxes	$3,450
Less: Taxes	$1,440
Net income	$2,010
Balance sheet for Belmond Inc is shown below
Balance sheet
Belmond Inc
Current assets:
Inventory	$6,500
Cash	$16,550
Accounts receivable	$9,600
Total current assets		$32,650
Fixed assets
Building and equipment	$122,000
Less: Accumulated depreciation	$34,000
Total fixed assets		$88,000
Total assets		$120,650
Liabilities and stockholder's equity
Current liabilities
Accounts payable	$4,800
Short term notes payable	$600
Total current liabilities		$5,400
Long term liabilities
Long term debt		$55,000
Total long term liabilities		$55,000
Total liabilities		$60,400
Shareholder's equity
Common stock	$45,000
Retained earnings (Plug-In)	$15,250	$60,250
Total liabilities and stockholder's equity		$120,650
Retained earnings is calculated as balancing figure