Preparing the Basic Financial Statements

Marilyn Miller opened a floral shop using $$45,000$ of her own cash savings and with $$135,000$ in cash borrowed from her parents.

She signed a lease on a small store for one year, agreeing to pay $$3,150$ per month in rent. During the first year of operations, Marilyn purchased fresh flowers from a local nursery for $$22,500,$ paid $$10,800$ for utilities, and

generated floral sales totaling $$108,000.$

$($Assume all transactions were cash transactions$).$ Marilyn was hoping to be able to repay her parents one$-$half of the borrowed money at the end of the first year of operations.

$($a$)$ Enter each of the above events in to the balance sheet equation as illustrated in the chapter.

$($b$)$Prepare an income statement, $($c$)$ balance sheet, and $($d$)$ statement of cash flow for the floral shop.

$($a$)$ Enter each of the above events in to the balance sheet equation as illustrated in the chapter.

Hint $-$ For this worksheet, make sure to enter all expense items as negative amounts.

Hint $-$ For this worksheet, make sure to enter all expense items as negative amounts.

$\backslash$table$[[$Balance Sheet Equation$],[$Transaction:$,$Issue stock,$\backslash$table$[[$Borrow$],[$cash$]],$Pay rent,$\backslash$table$[[$Purchase$],[$flowers$]],\backslash$table$[[$Pay$],[$utilities$]],$Floral sales,$\backslash$table$[[$Balance$],[$sheet$]]],[$Assets$],[$Cash$,$$$5,$s$,$$$,$$$,$$$,$s$,5],[$Total assets $>,,,,,,,$$