Question

Astro Corporation was started with the issue of 2,000 shares of $5 par stock for cash on January 1, 2018. The stock was issued at a market price of $12 per share. During 2018, the company earned $31,000 in cash revenues and paid $17,100 for cash expenses. Also, a $2,000 cash dividend was paid to the stockholders. Required Prepare an income statement, statement of changes in stockholders’ equity, balance sheet, and statement of cash flows for Astro Corporation’s 2018 fiscal year.

Answer 1

Answer:

Astro Corporation Income Statement

Revenues                              $31,000

Expenses                              ($17,100)

Net profit                               $13,900

Astro Corporation Statement of Changes in Shareholder Equity

                             Common stock      APIC        Ret. earnings     Total

Balance Jan. 1          $10,000            $14,000                            $24,000

Net income                                                            $13,900         $13,900

Dividends                                                              ($2,000)        ($2,000)

Balance Dec. 31      $10,000            $14,000       $11,900        $35,900

Astro Corporation Balance Sheet

Assets                                               Liabilities

Cash $35,900                                     $0

                                                         Shareholders' equity

                                                         Common stock $10,000

                                                         APIC $14,000

                                                         Retained earnings $11,900

Total $35,900                                  Total $35,900

Astro Corporation Statement of Cash Flows

Cash flows from operating activities:

Revenues                                       $31,000

Expenses                                        ($17,100)

     Cash from operating activities      $13,900                  

Cash flows form financing activities:

Stock issuance                               $24,000

Dividends paid                               ($2,000)

     Cash from financing activities      $22,000    

Net increase in cash                           $35,900