Question

To support herself while attending school, Daun Deloch sold stereo systems to other students. During the first year of operations, Deloch purchased the stereo systems for $169.000 and sold them for $318.000 cash. She provided her customers with a one-year warranty against defects in parts and labor. Based on Industry standards, she estimated that warranty claims would amount to 4 percent of sales. During the year, she paid $2.590 cash to replace a defective tuner. Required a-1. Prepare an income statement for Deloch's first year of operation a-2 Prepare a statement of cash flows for Deloch's first year of operation. Complete this question by entering your answers in the tabs below. Required A1 Required AZ Prepare an income statement for Deloch's first year of operation. DELOCH STEREOS Income Statement (Required A1 Required A2 >

Answer 1

Requirement (1) Deloch Stereos Income Statement Sales Revenue Cost of goods sold Gross Margin Warranty Expense Net Income $ $ $ $ $ 318,000 (169,000) 149,000 12,720 136,280 $ Requirement (2) Deloch Stereos Statement of Cash flows Cash flow from operating activities Inflow from Customers $ 318,000 Outflow to Purchase Inventory $ (169,000) Outflow for Warranty Expense $ (2,950) Net Cash flow from Operating Activities Cash Flow From Investing Activities Cash Flow From Financing Activities Net Change in Cash Plus : Beginning Cash Balance Ending Cash Balance $ 146,050 $ $ $ 146,050 $ $ 146,050 Note : Do Comment For Any Further Assistance