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1) (10%) Construct an annual income statement for a family with the following figures. Annual salaries total $160,000...mortgage payment is $890/month...food averages $400/month...interest income for the year is $50...transportation expenses average $450/month...dividend income for the year is $150...car payment is $485/month...clothes and personal expenses average $300/month...student loan payment is $400/month...property taxes are $2,300 per year...utilities average $390/month...insurance for home and auto total $2,500 per year...income taxes for the year are $35,000...recreation and vacation expenses for the year are $3,500. 2) (10%) What is the stockholder's equity of a company with beginning Retained Earnings of $3.8 million, current Net Profit of $2.1 million, 1.5 million shares of common stock issued at a par value of $1 per share and paid-in capital in excess of par of $7.50 per share? 3) (10%) Identify whether the following 12 accounting items belong in the Income Statement, Balance Sheet or neither: Cash, Depreciation Expense, Accumulated Depreciation, Line of credit limit, Principal loan balance, Interest Expense, Revenue, Cost of Goods Sold, Member Equity (LLC), Cash flows from investing activities, Accounts Receivable, Operating Profit. 4) (10%) Describe the revenue sources and channels for your team's company. This should include the specific products and/or services the company sells, the initial prices you intend to charge for each (this may change over the next several weeks), and all sales channels as applicable. Examples of different channels for a business may be Retail vs Online sales for a clothing store; Domestic vs International sales for a manufacturer; or Membership vs Merchandise & Supplement sales for a gym. 5) (10%) An LLC took out a loan for a new building 2 years ago. The principal balance of the loan at the end of the current year is $1 million. The company paid $43,000 of interest on the loan for the year. The company is using straight-line depreciation which amounts to $100,000 per year. 1 NOT FOR DISTRIBUTION OR SHARING OUTSIDE OF THIS COURSE Explain how the dollar amounts associated with this loan will impact both the income statement and balance sheet of the LLC for the current year. Include the accounting items and dollar amounts applicable to each statement. 6) (25%) Provide the initial template for your company's income statement. Reference the team project instructions and the partial template example in MyCourses. Your template should include the company name, reporting periods left to right (months and years), and applicable line items (Revenue, COGS, Gross Profit, Expenses, etc.). Include an initial list of expenses (at least 6) for the company. Quickly make up figures for each of your accounts such as Revenue, COGS and Expenses for the first 12 months so that you can set up formulas in Excel as appropriate to calculate Total Revenue (if multiple sales channels), Net Revenue (if there will be returns/allowances) Gross Profit, Operating Profit, Net Income and the Year 1 totals. The figures you enter don't require at this point any reasoning or justification. They are just 'dummy amounts to help make sure your template formulas are correct. 7) (25%) Provide the initial template for your company's balance sheet. The requirements are similar to question 6, although using appropriate balance sheet accounts. Include at least one depreciable fixed asset and set up the Member Equity accounts if your company is an LLC (Beginning Balance, Contribution, Distribution, Share of Net Income, Ending Balance)

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