Module 7 Assignment: Financial Statements Introductory Accounting does not require complex math or complicated procedures. It is important to be able to assign cost figures to their correct place in the key financial documents. This Assignment requires a two-step process: 1. Place the items listed below into either the Balance Sheet or the Income Statement. Item Amounts Balance Sheet Income Statement Example: Trucks (4) $97,000 $97,000 Cash $6,000 Salaries Expense $23,000 Supplies $3,000 Revenue $121,900 Inventory $7,000 Advertising Expense $4,000 Common Stock $60,000 Rent Expense $10,000 Depreciation Expense $17,000 Notes Payable $34,400 Accounts Payable $10,000 Utilities Expense $3,000 Salaries Payable $9,600 Accounts Receivable $5,000 Retained Earnings $16,000 Building $120,000 Utilities Payable $1,100 Cost of Goods Sold $55,000 2. Check your answers using the following formulas: A. REVENUE - COST OF GOODS SOLD = GROSS PROFIT - OPERATING EXPENSES = NET INCOME B. ASSETS = LIABILITIES + OWNERS EQUITY (OWNER'S EQUITY = RETAINED EARNINGS ENDING BALANCE + COMMON STOCK) Retained Earnings Beginning Balance + Net Income (Loss) - Dividends Retained Earnings Ending Balance Review your assignments. If you have the items in the right places, you should be able to calculate an Owner's Equity of $85,900 and a Gross Profit of $66,900. Be sure to include the Example: Trucks (4) in your calculations. If you don't get those answers, then you've probably got something in the wrong place