Expresso Royale

Balance Sheets
Dec 31 2020 Dec 31 2019
Assets
Cash 8,000 12,000
Accounts receivable 22,000 28,000
Inventory 94,000 66,000
Prepaid advertising 12,000 9,000
Long-term investments -- available for sale 30,000 41,000
Fair value adjustments to investments - (1,000)
PPE 178,000 130,000
Accumulated depreciation (72,000) (61,000)
Total assets 272,000 224,000
Liabilities and Equity
Accounts payable 27,000 14,000
Wages payable 6,000 2,500
Income tax payable 3,000 4,500
Common stock 139,000 125,000
Retained earnings 97,000 79,000
Unrealized loss on investments - (1,000)
Total liabilities and equity 272,000 224,000

Expresso Royale
Income Statement
Dec 31 2020
Sales 385,000
Dividend income 5,000
390,000
Cost of goods sold 233,000
Wages expense 82,000
Advertising expense 10,000
Depreciation expense 11,000
Income tax expense 17,000
Loss on sale of investments 2,000
Net income 35,000
Change Effect on
in 2020 Cash

(4,000)
(6,000) 6,000
28,000 (28,000)
3,000 (3,000)
(11,000) 11,000
1,000 (1,000)
48,000 (48,000)
(11,000) 11,000

13,000 13,000
3,500 3,500
(1,500) (1,500)
14,000 14,000
18,000 18,000
1,000 1,000
 Expresso Royale
Statement of Cash Flow
Indirect Method Dec 31 2020

Net income 35,000

Depreciation expense 11,000
Loss on sale of investments 2,000
Accounts receivable 6,000
Inventory (28,000)
Prepaid advertising (3,000)
Accounts payable 13,000
Wages payable 3,500
Income tax payable (1,500)
Cash from operating activities 38,000

Sale of investments 9,000

Purchase of PPE (48,000)
Cash used for investing activities (39,000)

Issuance of common stock 14,000

Payment of dividends (17,000)
Cash used for financing activities (3,000)

Total cash flow (4,000)

Cash at start of year 12,000
Cash at end of year 8,000

Expresso Royale
Statement of Cash Flow
Direct Method Dec 31 2020
Cash received from customers 391,000
Cash received as dividends 5,000
Cash paid for merchandise purchases (248,000)
Cash paid to employees (78,500)
Cash paid for advertising (13,000)
Cash paid for income taxes (18,500)
Net cash provided by operating activities 38,000

Sale of investments 9,000

Purchase of PPE (48,000)
Cash used for investing activities (39,000)

Issuance of common stock 14,000

Payment of dividends (17,000)
Cash used for financing activities (3,000)

Total cash flow (4,000)

Cash at start of year 12,000
Cash at end of year 8,000