ABC Company

Income Statement for the Year Ended December 21, 20x2

$ '000
Except EPS
Total Operating Revenues (or Total Sales Revenues) 2575.0
Less: Cost of Goods Sold (COGS) 1150.0
Gross Profits 1425.0
Less: Operating Expenses
Selling Expenses 275.0
General and Administrative Expenses (G&A) 225.0
Depreciation Expense 100.0
Fixed Expenses 75.0
Total Operating Expenses 675.0
Net Operating Income 750.0
Other Income 20.0
Earnings before Interest and Taxes (EBIT) 770.0
Less: Interest Expense
Interest on Short-Term Notes 10.0
Interest on Long-Term Borrowing 50.0
Total Interest Expense 60.0
Pretax Earnings (Earnings before Taxes, EBT) 710.0
Less: Taxes
Current Tax 160.0
Deferred Tax 124.0
Total Tax @ 40% 284.0
Net Income (Earnings after Taxes, EAT) 426.0
Less: Preferred Stock Dividends 95.0
Net Earnings Available for Common Stockholders 331.0
Earnings per Share (EPS), 100,000 shares outstanding $3.31
Retained Earnings 220.0
Dividend Paid to Holders of Common Stock 111.0
 ABC Company
Income Statement for the Year Ended December 21, 20X2 & 20X1

$ '000 $ '000
Except EPS Except EPS
20X2 20X1
Total Operating Revenues (or Total Sales Revenues) 2575.0 2050.0
Less: Cost of Goods Sold (COGS) 1150.0 985.0
Gross Profits 1425.0 1065.0
Less: Operating Expenses
Selling Expenses 275.0 250.0
General and Administrative Expenses (G&A) 225.0 205.0
Depreciation Expense 100.0 95.0
Fixed Expenses 75.0 75.0
Total Operating Expenses 675.0 625.0
Net Operating Income 750.0 440.0
Other Income 20.0 15.0
Earnings before Interest and Taxes (EBIT) 770.0 455.0
Less: Interest Expense
Interest on Short-Term Notes 10.0 10.0
Interest on Long-Term Borrowing 50.0 55.0
Total Interest Expense 60.0 65.0
Pretax Earnings (Earnings before Taxes, EBT) 710.0 390.0
Less: Taxes
Current Tax 160.0 156.0
Deferred Tax 124.0 .0
Total Tax @ 40% 284.0 156.0
Net Income (Earnings after Taxes, EAT) 426.0 234.0
Less: Preferred Stock Dividends 95.0 95.0
Net Earnings Available for Common Stockholders 331.0 139.0
Earnings per Share (EPS), 100,000 shares outstanding $3.31 $1.39
Retained Earnings 220.0 50.0
Dividend Paid to Holders of Common Stock 111.0 89.0
 ABC Company

Balance Sheet
as of December 31, 20X2 & December 31, 20X1
$ '000 $ '000
20X2 20X1
Assets
Current Assets
Cash and Equivalents 1565.0 990.0
Accounts Receivable 565.0 605.0
Inventories 895.0 1215.0
Other 215.0 180.0
Total Current Assets 3240.0 2990.0
Fixed Assets (at cost)
Land and Buildings 2400.0 2400.0
Machinery and Equipment 1880.0 1575.0
Furniture and Fixtures 435.0 390.0
Vehicles 140.0 115.0
Less: Accumulated Depreciation 1005.0 905.0
Net Fixed Assets 3850.0 3575.0
Other (includes certain leases) 75.0 70.0
Total Fixed Assets 3925.0 3645.0
Total Assets 7165.0 6635.0
Liabilities &Equity
Current Liabilities
Accounts Payable 300.0 295.0
Short-Term Notes Payable 1275.0 965.0
Accruals and Other Current Liabilities 145.0 295.0
Total Current Liabilities 1720.0 1555.0
Long-Term Debt 1900.0 1755.0
Total Liabilities 3620.0 3310.0
Stockholder’s Equity
Preferred Stock 200.0 200.0
Common Stock ($10.00 par, 100,000 sh 1000.0 1000.0
Paid-in capital in excess of par on co 1985.0 1985.0
Retained Earnings 360.0 140.0
Total Stockholders’ Equity 3545.0 3325.0
Total Liabilities and Owner’s Equity 7165.0 6635.0
Check: Assets Equals Liabilities + Net 1 1
TRUE TRUE
 ABC Company
Income Statement for the Year Ended December 21, 20X2 & 20X1
$ '000
Cash Flows from Operations
Net Income (Earnings after Taxes, EAT) 426.0
Depreciation Expense 100.0
Deferred Taxes for Preceding Year .0
Changes in Assets
Change in Accounts Receivable 40.0
Change in Inventories 320.0
Change in Other Current Assets -35.0
Changes in Liabilities
Change in Accounts Payable 5.0
Change in Short-Term Notes Payable 310.0
Change in Accruals and Other Current Liabilities -150.0
Net Cash Flow from Operations 1016.0
Casf Flows from Investing Activities
Net Cash Flow from Investing Activities -380.0
Casf Flows from Financing Activities
Change in Long-Term Debt 145.0
Dividends Paid to Holders of Preferred and Common Stock -206.0
Net Cash Flow from Financing Activities -61.0
Total Cash Flow from Operations, Investing, and Financing 575.0
Check: Total Cash Flow in 20X2 must equal the Change in Cash and
Equivalents on the Balance Sheet from 20X1 to 20X2. TRUE
 $ '000

426.0 426000
100.0 100000
0

40.0 40000
320.0 320000
-35.0 -35000

5.0 5000
310.0 310000
-150.0 -150000
1016.0 1016000

-380.0 -380.0

145.0
-206.0
-61.0
575.0