80.2K

Verified Solution

Link Copied!

Yummy-Licious Ice Cream, Inc. opens its first store in Calgary in January 2021. It sells two types of fresh fruit-based ice cream (regular & special) to Calgarian kids. Below is the unadjusted trial balance of Yummy-Licios Ice Cream, Inc. at the end of the first quarter of its second year of operation (January 1- March 30, 2022). Yummy-Licios Ice Cream Inc. Unadjusted Trial Balance At March 30, 2022 Cash $ 17,000.00 Accounts Receivable $ 600.00 Prepaid Rent $ 7,300.00 Equipment $ 9,700.00 Trademark $ 9,700.00 Accounts Payable $ 10,800.00 Deferred Revenue $ 400.00 Notes Payable (Long-term) $ 20,000.00 Common Stock $ 10,000.00 Retained Earnings, Jan. 1, 2022 $ 1,100.00 Dividends $ 300.00 Sales Revenue $ 11,300.00 Cost of ingredients $ 4,500.00 Salaries and Wages $ 3,200.00 Utilities Expense $ 700.00 Advertising Expenses $ 600.00 TOTAL $ 53,600.00 $ 53,600.00 Required: Based on the unadjusted trial balance of Yummy-Licios Ice Cream, Inc. above, you are required to prepare/write the following: 1) An income statement (8 points); 2) A statement of retained earnings (4 points); 3) Balance Sheet (12 points); 4) A paragraph stating your evaluation of the companys performance and financial status for the quarter ending March 30, 2022. (6 points) In your evaluation, state whether: o the business is profitable; o it is able to pay its current obligations/liabilities; o its assets are financed more by debts or equity; o its retained earnings increased or decreased during the quarter and why. You may state any other insights you have on the companys financial statements. Justify your evaluation and support your discussion with relevant calculations or ratios. Submission Instruction: (1) Prepare all the requirements on the Excel Workbook provided.

Answer & Explanation Solved by verified expert

See Answer