Key Objectives:

Income Statement: Analyze ABC's financial performance by measuring revenue, expenses, and profitability. Formulas in Excel will ensure accuracy in calculating gross profit, operating expenses, and net income.

Balance Sheet: Capture a snapshot of ABC's financial position at year$-$end by presenting its assets $($cash$,$ inventory, etc.$)$ and liabilities $($debt$,$ etc.$).$ Formulas will guarantee the statement adheres to the fundamental accounting equation.

Cash Flow Statement: Track ABC's cash movement by identifying sources and uses of cash for operations, investing, and financing activities. Excel functions will calculate net cash flow, revealing insights into liquidity and cash management.

Instructions:

This exercise involves preparing an income statement, balance sheet, and cash flow statement for a fictional company called "ABC Corporation" based on the provided data. You have been provided with the following data for ABC Corporation for the year ending December $31,20$XX:

Income Statement Data:

Sales Revenue: $$500,000$

Cost of Goods Sold $($COGS$)$: $$250,000$

Gross Profit: Calculate the gross profit.

Operating Expenses: $$150,000$

Net Income: Calculate the net income.

Balance Sheet Data:

Cash: $$50,000$

Accounts Receivable: $$30,000$

Inventory: $$40,000$

Property, Plant, and Equipment $($PPE$)$: $$200,000$

Accumulated Depreciation: $$30,000$

Total Assets: Calculate the total assets.

Accounts Payable: $$20,000$

Short$-$term Debt: $$15,000$

Long$-$term Debt: $$100,000$

Total Liabilities: Calculate the total liabilities.

Common Stock: $$50,000$

Retained Earnings $($beginning of the year$)$: $$25,000$

Retained Earnings $($end of the year$)$: $$105,000.$

Total Equity: Calculate the total equity.

Cash Flow Statement Data:

Cash from Operations: $$150,000$

Cash from Investing: Assume $$10,000$ was spent on purchasing PPE and $$5,000$ was received from selling an old asset.

Cash from Financing: Assume $$20,000$ was borrowed $($long$-$term debt$)$ and $$10,000$ was repaid $($short$-$term debt$).$

Net Cash Flow: Calculate the net cash flow for the year.

I$\text{'}$d like you to please create Excel worksheets for the Income Statement, Balance Sheet, and Cash Flow Statement.

Here's a step$-$by$-$step guide for each statement:

Income Statement:

In an Excel worksheet, create a table with the following headers: "Item," "Amount," and "Notes."

Fill in the "Item" column with the appropriate income statement items $($e$.$g$.,$ Sales Revenue, COGS, Gross Profit, Operating Expenses, Net Income$).$

In the "Amount" column, input the respective values for each item.

Use Excel formulas to calculate Gross Profit and Net Income.

Balance Sheet:

Create another Excel worksheet with the headers: "Item," "Amount," and "Notes."

Input the balance sheet items $($e$.$g$.,$ Cash, Accounts Receivable, Inventory, PPE, Accumulated Depreciation, Accounts Payable, Short$-$term Debt, Long$-$term Debt, Common Stock, Retained Earnings$)$ in the "Item" column.

Input the respective values for each item in the "Amount" column.

Use Excel formulas to calculate Total Assets, Total Liabilities, and Total Equity.

Cash Flow Statement:

Create a third Excel worksheet with the headers: "Item," "Amount," and "Notes."

Input the cash flow statement items $($e$.$g$.,$ Cash from Operations, Cash from Investing, Cash from Financing, Net Cash Flow$)$ in the "Item" column.

Input the respective values for each item in the "Amount" column.

Use Excel formulas to calculate Cash from Operations and Net Cash Flow based on the provided data.

Final Check

As you format your Excel worksheets, pay careful attention to presentation, ensuring clarity and readability. Use appropriate formatting options for currency values, such as the currency format or accounting format, to display financial figures. This helps make the financial statements more professional and easier to understand.

Double$-$check all calculations to ensure accuracy. This includes verifying formulas for gross profit, net income, total assets, total liabilities, total equity, cash from operations, and net cash flow. By meticulously reviewing each calculation, you can identify and correct any errors, ensuring the reliability of your financial statements.

Excel offers a variety of built$-$in functions that can streamline your calculations. For example, the SUM function can be used to total values within a range, while subtraction and addition functions can perform straightforward arithmetic operations. Leveraging these functions can simplify the process of computing financial metrics and minimize the risk of calculation errors.

Overall, taking the time to format your worksheets neatly and verify your calculations diligently will result in accurate and professional$-$looking financial statements for ABC Corporation. This attention to detail is essential for producing reliable financial information that stakeholders can trust when making decisions.

Upon completion of the worksheets outlined, you will have generated a com