Question

P2.3A (LO 1), AP You are provided with the following information for Lazuris Enterprises, effective as of its April 30, 2022, year-end.

Prepare financial statements.

Accounts payable		$  834
Accounts receivable		810
Accumulated depreciation—equipment		670
Cash		1,270
Common stock		16,900
Cost of goods sold		1,060
Depreciation expense		335
Dividends		325
Equipment		2,420
Goodwill		1,800
Income tax expense		165
Income taxes payable		135
Insurance expense		210
Interest expense		400
Inventory		967
Investment in land		14,200
Land		3,100
Mortgage payable (long-term)		3,500
Notes payable (short-term)		61
Prepaid insurance		60
Retained earnings (beginning)		1,600
Salaries and wages expense		700
Salaries and wages payable		222
Sales revenue		5,100
Stock investments (short-term)		1,200

Instructions

a. Prepare an income statement and a retained earnings statement for Lazuris Enterprises for the year ended April 30, 2022.

Net income

$2,230

b. Prepare a classified balance sheet for Lazuris Enterprises as of April 30, 2022.

Tot. current assets	$4,307
Tot. assets	$25,157

Answer 1

Lazuris Enterprises
Income Statement
For the year ended April 30, 2022
Sales Revenue		$5,100.00
Less: Cost of Goods Sold		$1,060.00
Gross Profit		$4,040.00
Less: Operating Expenses
Salaries and Wages Expense	$700.00
Insurance Expense	$210.00
Depreciation Expense	$335.00
Total Operating Expenses		$1,245.00
Income from Operations		$2,795.00
Less: Interest Expense		$400.00
Income before Taxes		$2,395.00
Less: Income Tax Expense		$165.00
Net Income		$2,230.00

Lazuris Enterprises
Statement of Retained Earnings
For the year ended April 30, 2022
Retained Earnings, beginning	$1,600.00
Add: Net Income	$2,230.00
Less: Dividends	-$325.00
Retained Earnings, ending	$3,505.00

Lazuris Enterprises
Balance Sheet
April 30, 2022
Assets
Current Assets
Cash	$1,270.00
Accounts Receivable	$810.00
Inventory	$967.00
Prepaid Insurance	$60.00
Stock Investments ( Short Term )	$1,200.00
Total Current Assets		$4,307.00
Investments
Investment in Land		$14,200.00
Property Plant & Equipment
Equipment	$2,420.00
Less: Accumulated Depreciation	-$670.00
Equipment, net	$1,750.00
Land	$3,100.00	$4,850.00
Intangible Assets
Goodwill		$1,800.00
Total Assets		$25,157.00
Liabilities
Current Liabilities
Accounts Payable	$834.00
Salaries and Wages Payable	$222.00
Income Taxes Payable	$135.00
Notes Payable ( Short Term )	$61.00
Total Current Liabilities		$1,252.00
Long Term Liabilities
Mortgage Payable		$3,500.00
Total Liabilities		$4,752.00
Stockholders' Equity
Common Stock	$16,900.00
Retained Earnings	$3,505.00
Total Stockholders' Equity		$20,405.00
Total Liabilities and Stockholders' Equity		$25,157.00