Question details

Analyzing Findings from the Financial Statement
$ 15.00

income statement

·          

·        

Resources: Financial Accounting: Tools for Business Decision Making, p. 36

Scenario: On June 1, 2017, Elite Service Co. was started with an initial investment in the company of $22,100 cash. Below are the assets, liabilities, and common stock of the company June 30, 2017, and the revenues and expenses for the month of June, its first month of operations: 

 

Cash

$ 4,600

Notes payable

$12,000

Accounts receivable

4,000

Accounts payable

500

Service revenue

7,500

Supplies expense

1,000

Supplies

2,400

Maintenance and repairs expense

600

Advertising expense

400

Utilities expense

300

Equipment

26,000

Salaries and wages expense

1,400

Common stock

22,100

 

 

In June, the company issues no additional stock but paid dividends of $1,400. 

Prepare an income statement, retained earnings statement, and balance sheet analyzing your findings using the questions below, in a total of 700-1000 words:

  • Briefly address whether the company's first month of operations was a success.
  • Discuss the company's decision to distribute a dividend.

Use the Excel® spreadsheet to show your work and submit with your analysis.  There are two documents to be submitted (Excel spreadsheet showing the financial statements and analysis on Word document).

Available solutions