Assume an accounting period of 1 week. You start an ice cream business and this is...
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Assume an accounting period of 1 week. You start an ice cream business and this is what you do in your first week (all of the below occurs during week 1): . You invest $5 in your ice cream selling business You get a $25 loan from the bank. You go to the grocery store to buy half-and-half, heavy cream, eggs, vanilla sugar, and vanilla extract. You buy enough to make 40 scoops. Your total cost is $20. You pay $10 in cash and $10 is charged to your account at the grocer. . Your brother makes a batch of ice cream for 20 scoops and charges $1 for production labor (cash). You sell the 20 scoops at $1 each. You receive cash for 10 scoops and the other 10 scoops are purchased on account. You repay $10 of the bank loan. The banker charges you $1 in interest (cash). The neighbors where you have your ice cream stand ask you to buy an insurance policy. The insurance agent offers you a three-week policy which costs $3 payable in advance. You have to pay for the entire policy in cash now. . You purchase an ice cream stand for $8. You also buy a tiny patch of land from a friend's family for $2. You pay for the stand and the land with cash. You depreciate the ice cream stand $1/week including during your first week of business. • A customer pays $4 for four scoops she bought on account. Please fill out an ending balance sheet, income statement, and cash flow statement for this week. GRADING RUBRIC (out of 30 points) Max points 10 10 10 . Balance Sheet Income Statement Cash Flow Statement Assume an accounting period of 1 week. You start an ice cream business and this is what you do in your first week (all of the below occurs during week 1): . You invest $5 in your ice cream selling business You get a $25 loan from the bank. You go to the grocery store to buy half-and-half, heavy cream, eggs, vanilla sugar, and vanilla extract. You buy enough to make 40 scoops. Your total cost is $20. You pay $10 in cash and $10 is charged to your account at the grocer. . Your brother makes a batch of ice cream for 20 scoops and charges $1 for production labor (cash). You sell the 20 scoops at $1 each. You receive cash for 10 scoops and the other 10 scoops are purchased on account. You repay $10 of the bank loan. The banker charges you $1 in interest (cash). The neighbors where you have your ice cream stand ask you to buy an insurance policy. The insurance agent offers you a three-week policy which costs $3 payable in advance. You have to pay for the entire policy in cash now. . You purchase an ice cream stand for $8. You also buy a tiny patch of land from a friend's family for $2. You pay for the stand and the land with cash. You depreciate the ice cream stand $1/week including during your first week of business. • A customer pays $4 for four scoops she bought on account. Please fill out an ending balance sheet, income statement, and cash flow statement for this week. GRADING RUBRIC (out of 30 points) Max points 10 10 10 . Balance Sheet Income Statement Cash Flow Statement
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Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
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