Question

Exercise 5-11 (Part Level Submission)

An alphabetical list of Blossoms Company's adjusted accounts at its fiscal year end, August 31, 2017, follows. All accounts have normal balances.

Accounts payable		$15,500		Notes payable		$42,000
Accumulated depreciation—equipment		14,000		Prepaid insurance		575
Accumulated depreciation—furniture		17,500		R. Smistad, capital		65,750
Cash		25,450		R. Smistad, drawings		70,000
Cost of goods sold		271,500		Rent expense		24,000
Depreciation expense		7,000		Salaries expense		50,000
Equipment		35,000		Salaries payable		2,250
Furniture		42,000		Sales		465,000
Insurance expense		3,575		Sales returns and allowances		16,300
Interest expense		2,100		Supplies		950
Interest payable		525		Supplies expense		6,325
Merchandise inventory		70,350		Unearned revenue		2,600

Additional information:

1. Of the notes payable, $6,000 becomes due on February 17, 2018. The balance is due in 2019.
2. On July 18, 2017, R. Smistad invested $3,500 cash in the business.

PREPARE A STATEMENT OF OWNER'S EQUITY

CASH FLOW STATEMENTS

Answer 1

please note that for cash flow statements, I will require prior periods information.

Retained earnings statements is as below:

Blossoms Company
statement of owners equity
August 31, 2017 (amounts in $)
beginning capital	65750
add: additional capital	3500
add: net income	84200
less: drawings	-70000
ending balance of owners equity	83450

calculation of net income is as below

Income statement (amounts in $)
sales	465000
less: sales returns	16300
net sales	448700
cost of goods sold	271500
gross profit	177200
less: expenses
salaries expenses	50000
rent expenses	24000
depreciation expenses	7000
supplies expenses	6325
insurance expenses	3575
operating income	86300
less: interest expenses	2100
net income	84200