| The Panama Pajama Company began operations on January 1, 2015, and is now in its third year of operations. | | | | | |
| The adjusted trial balance as of December 31, 2018 appears below, along with prior year balance sheet data and some additional transaction data for 2018. | |
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| | THE PANAMA PAJAMA COMPANY | | | | | |
| | Adjusted Trial Balance | | | | | |
| | 12/31/18 | | | | | |
| | | 2018 | 2017 | | | |
| | Account Title | Adjusted Trial Balance | Balance Sheet Info | | | |
| | | Debit | Credit | Debit | Credit | | | |
| | Cash | $ 138,000 | | $ 35,600 | | | | |
| | Accounts Receivable | 12,000 | | 11,000 | | | | |
| | Inventory | 4,400 | | 5,600 | | | | |
| | Office Equipment | 26,000 | | 20,000 | | | | |
| | Machinery & Tools | 59,000 | | 21,000 | | | | |
| | Accumulated DepreciationPlant Assets | | $ 8,600 | | 6,000 | | | |
| | Accounts Payable | | 12,200 | | 9,800 | | | |
| | Note PayableShort Term | | 10,000 | | 15,500 | | | |
| | Note PayableLong Term | | 33,000 | | - | | | |
| | Common Stock, $10 par | | 150,000 | | 50,000 | | | |
| | Retained Earnings | | 11,900 | | 11,900 | | | |
| | Dividends | 1,000 | | | | | | |
| | Sales Revenue | | 31,700 | | | | - | |
| | Cost of Goods Sold | 11,600 | | | | | | |
| | Rent Expense | 2,000 | | | | | | |
| | Advertising Expense | 800 | | | | | | |
| | Depreciation Expense | 2,600 | | | | | | |
| | | $ 257,400 | $ 257,400 | | | | | |
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| | Transaction Data for 2018 (Note, these transactions were included in the trial balance numbers above.) | | | | | | |
| | Cash paid for purchase of office equipment | $ 6,000 | | | | | | |
| | Cash paid for purchase of tools | 5,000 | | | | | | |
| | Acquisition of Machinery with Notes PayableLong-term | 33,000 | | | | | | |
| | Cash payment of dividends | 1,000 | | | | | | |
| | Cash receipt from issuance of 10,000 shares of common stock | 100,000 | | | | | | |
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| Requirements: (See sheet tabs at bottom. Use each sheet for the following requirements.) | | | | | | |
| Use Excel Skills in completing these requirements. You must use formulas and functions, cell references, and professional formatting. |
| 1. | Prepare the Panama Pajama Company multi-step income statement for the year ended December 31, 2018. Include the EPS at the bottom. | | |
| | Also include a vertical analysis column at the right and perform a vertical analysis of the income statement. (Use percentage format with 1 decimal place.) |
| 2. | Prepare the Panama Pajama Company balance sheet for December 31, 2018. Include a vertical analysis column at the right | | | |
| | and perform a vertical analysis of the balance sheet. (Use the percentage format with 1 decimal place.) | | | | | |
| 3. | Prepare the Panama Pajama Company statement of cash flows for the year ended December 31, 2018. Use the indirect method. | | | |
| 4. | Complete the analysis of the financial statements as directed on the Analysis sheet. | | | | | | |
| 5. | Answer the question regarding the differences between IFRS and GAAP on the IFRS Perspective sheet. | | | | | |
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