Required information [The following information applies to the questions displayed below.] The following data refer to snack maker Taquitos To Go for the year 20x1. Work-in-process inventory, 12/31/x0 Selling and administrative salaries Insurance on factory and equipment Work-in-process inventory, 12/31/x1 Finished-goods inventory, 12/31/x0 Cash balance, 12/31/x1 Indirect material used Depreciation on factory equipment Raw-material inventory, 12/31/x0 Property taxes on factory Finished-goods inventory, 12/31/x1 Purchases of raw material in 20x1 Utilities for factory Utilities for sales and administrative offices Other selling and administrative expenses Indirect-labor cost incurred Depreciation on factory building Depreciation on cars used by sales personnel Direct-labor cost incurred Raw-material inventory, 12/31/x1 Total Accounts receivable, 12/31/x1 Rental for warehouse space to store raw material Rental of space for company president's office Applied manufacturing overhead Sales revenue Income tax expense 3. Prepare the company's income statement for 20x1. TAQUITOS TO GO Income Statement For the Year Ended December 31, 20X1 Sales revenue Less: Cost of goods sold Gross margin Selling and administrative expenses: Salaries Utilities Rental of office space Depreciation Other selling and administrative expenses $ 209,800 $ $ 209,800 0 209,800 209,800 $ 8,000 13,700 3,600 8,300 14,000 6,000 4,600 2,100 10,100 2,400 15,400 39,000 6,000 2,500 4,000 29,000 3,600 1,200 79,000 11,000 4,100 3,100 1,600 58,000 209,800 5,100 4
Reporting Cash Flows
Reporting of cash flows means a statement of cash flow which is a financial statement. A cash flow statement is prepared by gathering all the data regarding inflows and outflows of a company. The cash flow statement includes cash inflows and outflows from various activities such as operating, financing, and investment. Reporting this statement is important because it is the main financial statement of the company.
Balance Sheet
A balance sheet is an integral part of the set of financial statements of an organization that reports the assets, liabilities, equity (shareholding) capital, other short and long-term debts, along with other related items. A balance sheet is one of the most critical measures of the financial performance and position of the company, and as the name suggests, the statement must balance the assets against the liabilities and equity. The assets are what the company owns, and the liabilities represent what the company owes. Equity represents the amount invested in the business, either by the promoters of the company or by external shareholders. The total assets must match total liabilities plus equity.
Financial Statements
Financial statements are written records of an organization which provide a true and real picture of business activities. It shows the financial position and the operating performance of the company. It is prepared at the end of every financial cycle. It includes three main components that are balance sheet, income statement and cash flow statement.
Owner's Capital
Before we begin to understand what Owner’s capital is and what Equity financing is to an organization, it is important to understand some basic accounting terminologies. A double-entry bookkeeping system Normal account balances are those which are expected to have either a debit balance or a credit balance, depending on the nature of the account. An asset account will have a debit balance as normal balance because an asset is a debit account. Similarly, a liability account will have the normal balance as a credit balance because it is amount owed, representing a credit account. Equity is also said to have a credit balance as its normal balance. However, sometimes the normal balances may be reversed, often due to incorrect journal or posting entries or other accounting/ clerical errors.
![Required information
[The following information applies to the questions displayed below.]
The following data refer to snack maker Taquitos To Go for the year 20x1.
Work-in-process inventory, 12/31/x0
Selling and administrative salaries
Insurance on factory and equipment
Work-in-process inventory, 12/31/x1
Finished-goods inventory, 12/31/x0
Cash balance, 12/31/x1
Indirect material used
Depreciation on factory equipment
Raw-material inventory, 12/31/x0
Property taxes on factory
Finished-goods inventory, 12/31/x1
Purchases of raw material in 20x1
Utilities for factory
Utilities for sales and administrative
offices
Total
2,500
4,000
29,000
Depreciation on factory building
3,600
Depreciation on cars used by sales personnel 1,200
Direct-labor cost incurred
Raw-material inventory, 12/31/x1
Other selling and administrative expenses
Indirect-labor cost incurred
Accounts receivable, 12/31/x1
Rental for warehouse space to store raw
material
Rental of space for company president's
office
Applied manufacturing overhead
Sales revenue
Income tax expense
3. Prepare the company's income statement for 20x1.
TAQUITOS TO GO
Income Statement
For the Year Ended December 31, 20X1
Sales revenue
Less: Cost of goods sold
Gross margin
Selling and administrative expenses:
Salaries
Utilities
Rental of office space
Depreciation
Other selling and administrative
expenses
$
209,800
$
$
209,800
0
209,800
$ 8,000
13,700
3,600
8,300
14,000
6,000
4,600
2,100
10,100
2,400
15,400
39,000
6,000
209,800
79,000
11,000
4,100
3,100
1,600
58,000
209,800
5,100](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fadddc24f-23fa-4799-bf61-1e831cb8379d%2F98fd1d4e-5a03-49d6-a7e9-c520c51cc4d8%2F300oc2_processed.jpeg&w=3840&q=75)
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