Saved Help Save Exit Submit 2 Check my work Bensen Company

Saved Help Save & Exit Submit 2 Check my work Bensen Company began operations when it acquired $27,100 cash from the issue of common stock on January 1, 2018. The cash acquired was immediately used to purchase equipment for $27,100 that had a $4,300 salvage value and an expected useful life of four years. The equipment was used to produce the following revenue stream (assume all revenue transactions are for cash). At the beginning of the fifth year, the equipment was sold for $4,820 cash. Bensen uses straight-line depreciation 2022 $0 2021 2018 $7,650 $8,150 $8,350 $7,150 2019 2020 Revenue Required Prepare income statements, statements of changes in stockholders\' equity, balance sheets, and statements of cash flows for each of the five years. Present the statements in the form of a vertical statements model. (Statement of Cash Flows and Balance Sheet only: Items to be deducted must be indicated with a minus sign.)

Solution

Bensen company Income Statement For the year ending 2018 2019 2020 2021 2022 Revenue 7650 8150 8350 7150 0 Less Depreciation (271000 - 4300)/5 5700 5700 5700 5700 Add: profit on sale of equipment 520 Net profit 1950 2450 2650 1450 520 Bensen company Statement of changes in stockholders Equity For the year ending 2018 2019 2020 2021 2022 Opening Balance 29050 31500 34150 35600 Common stock issued 27100 0 0 0 0 Add- Retained Earnings 1950 2450 2650 1450 520 Closing Balance 29050 31500 34150 35600 36120 Bensen company Balance sheet For the year ending 2018 2019 2020 2021 2022 Cash 7650 15800 24150 31300 36120 Equipment 27100 27100 27100 27100 0 Less- Accumulated depreciation -5700 -11400 -17100 -22800 0 Net Equipment 21400 15700 10000 4300 0 Total Assets 29050 31500 34150 35600 36120 Common stock 27100 27100 27100 27100 27100 Retained Earnings 1950 4400 7050 8500 9020 Total stockhlders Equity 29050 31500 34150 35600 36120 Bensen company Cash Flow Statement For the year ending 2018 2019 2020 2021 2022 Opening Balance 0 7650 15800 24150 31300 Common stock issued 27100 0 0 0 0 Purchase of Equipment -27100 0 0 0 0 Cash received from customers 7650 8150 8350 7150 Closing Balance 7650 15800 24150 31300 31300