You are an accountant for The Flower Shoppe…

Question:

You are an accountant for The Flower Shoppe. Your supervisor has asked you to help her prepare the year-end financial statements. Before you do, she wants to ensure that you understand some main points.

Explain the following:

The elements of the balance sheet, their purposes, and how to measure them

The elements and purpose of the statement of changes in stockholder’s equity

Based on the adjusted trial balance and additional information, prepare the following in an Excel file to give to the controller for review:

Balance sheet

Income statement

Statement of retained earnings

Statement of cash flows

The following is additional information about the Flower Shoppe that is needed for financial-statement preparation:

Net income for the year ended December 31, 2008 was $10,845.

Changes from the prior year’s balances included the following:

a decrease in accounts receivable of $300.

a decrease in inventory of $450.

an increase in accounts payable of $250.

a decrease in accrued expenses of $100.

Land was purchased in April for $3,500.

Cash as of January 1, 2008 was $10,105.

The Flower Shoppe
Adjusted Trial Balance
December 31, 2008
DebitCredit
Cash$22,750
Accounts Receivable3,200
Inventory8,000
Land27,000
Building56,000
Accumulated Depreciation16,800
Accounts Payable4,600
Accrued Expenses2,500
Common Stock20,000
Additional Paid-in Capital10,000
Dividends1,200
Retained Earnings53,405
Sales112,020
Returns1,300
Purchases47,000
Salaries38,000
Supplies870
Utilities5,225
Telephone2,850
Bank Charges330
Depreciation Expense5,600
$219,325$219,325

Answer:

Leave a Comment

Your email address will not be published. Required fields are marked *