Upton Company was started on January 1, 2011, when the owners invested $160,000

Question

Upton Company was started on January 1, 2011, when the owners invested $160,000 cash in the business. During 2011, the company earned cash revenues of $120,000 and incurred cash expenses of $82,000. The company also paid cash distributions of $15,000.
Required:

Prepare a 2011 income statement, capital statement (statement of changes in equity), balance sheet, and statement of cash flows using each of the following assumptions. (Consider each assumption separately.)

Upton is a sole proprietorship owned by J. Upton. (For balance sheet be sure to list the assets and liabilities in order of their liquidity. All expenses and amounts to be deducted should be indicated with minus sign. Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.)

$  

$

$

$   

  

$   

  

  

   

   

$    

Upton is a partnership with two partners, Dan and Nancy Upton. Dan invested $100,000 and Nancy invested $60,000 of the $160,000 cash that was used to start the business. Nancy was expected to assume the vast majority of the responsibility for operating the business. The partnership agreement called for Nancy to receive 60 percent of the profits and Dan the remaining 40 percent. With regard to the $15,000 distribution, Nancy withdrew $6,000 from the business and Dan withdrew $9,000. (For balance sheet be sure to list the assets and liabilities in order of their liquidity. All expenses and amounts to be deducted should be indicated with minus sign. Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.)

$   

$    

$   

$0   

  

$   

  

$   

3.

Upton is a corporation. The owners were issued 10,000 shares of $10 par common stock when they invested the $160,000 cash in the business. (For balance sheet be sure to list the assets and liabilities in order of their liquidity. All expenses and amounts to be deducted should be indicated with minus sign. Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.)

$   

   

   

  

$   

$   

$   

   

  

$   

  

  

  

  

$   

Prepare a 2011 income statement, capital statement (statement of changes in equity), balance sheet, and statement of cash flows using each of the following assumptions. (Consider each assumption separately.)

(a)

Upton is a sole proprietorship owned by J. Upton. (For balance sheet be sure to list the assets and liabilities in order of their liquidity. All expenses and amounts to be deducted should be indicated with minus sign. Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.)

Upton Company
Income Statements
For the Year Ended December 31, 2011   Revenues $   Expenses   

$  

Upton Company
Capital Statement
For the Year Ended December 31, 2011     $                Ending Capital Balance

$

Upton Company
Balance Sheet
As of December 31, 2011     Assets            

$

   Total Assets

$   

   Liabilities $0       Equity            

  

   Total Liabilities and Equity

$   

Upton Company
Statement of Cash Flows
For the Year Ended December 31, 2011    Cash Flows From Operating Activities:             $               

  

   Net Cash Flow from Operating Activities $        Cash Flows From Investing Activities 0        Cash Flows From Financing Activities:                             

  

   Net Cash Flow from Financing Activities

   

   Net Change in Cash        

   

   Ending Cash Balance

$    

2. (b)

Upton is a partnership with two partners, Dan and Nancy Upton. Dan invested $100,000 and Nancy invested $60,000 of the $160,000 cash that was used to start the business. Nancy was expected to assume the vast majority of the responsibility for operating the business. The partnership agreement called for Nancy to receive 60 percent of the profits and Dan the remaining 40 percent. With regard to the $15,000 distribution, Nancy withdrew $6,000 from the business and Dan withdrew $9,000. (For balance sheet be sure to list the assets and liabilities in order of their liquidity. All expenses and amounts to be deducted should be indicated with minus sign. Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.)

Upton Company
Income Statement
For the Year Ended December 31, 2011    Revenues $       Expenses       

$   

Upton Company
Capital Statement
For the Year Ended December 31, 2011     $                                 Ending Capital Balance

$    

Upton Company
Balance Sheet
As of December 31, 2011    Assets             

$   

   Total Assets $       Liabilities

$0   

   Equity                           

  

   Total Liabilities and Equity

$   

Upton Company
Statement of Cash Flows
For the Year Ended December 31, 2011    Cash Flows From Operating Activities:             $                Net Cash Flow from Operating Activities $       Cash Flows From Investing Activities 0       Cash Flows From Financing Activities:                             Net Cash Flow from Financing Activities

  

    Net Change in Cash                Ending Cash Balance

$   

3.

(c)

Upton is a corporation. The owners were issued 10,000 shares of $10 par common stock when they invested the $160,000 cash in the business. (For balance sheet be sure to list the assets and liabilities in order of their liquidity. All expenses and amounts to be deducted should be indicated with minus sign. Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.)

Upton Inc.
Income Statement
For the Year Ended December 31, 2011    Revenues $       Expenses       

$   

Upton Inc.
Statement of Changes in Stockholders' Equity
For the Year Ended December 31, 2011      $         

   

     $                          

   

    

  

    Total Stockholders' Equity

$   

Upton Inc.
Balance Sheet
As of December 31, 2011    Assets         

$   

   Total Assets

$   

   Liabilities $0       Stockholders' Equity          $             

   

   Total Paid-In Capital   

  

Total Liabilities and Stockholders' Equity

$   

Upton Inc.
Statement of Cash Flows
For the Year Ended December 31, 2011    Cash Flows From Operating Activities:            $              

  

   Net Cash Flow from Operating Activities $       Cash Flows From Investing Activities 0       Cash Flows From Financing Activities:                           

  

   Net Cash Flow from Financing Activities

  

   Net Change in Cash       

  

   Ending Cash Balance

$   

Explanation / Answer

Upton Inc Financial Statements For the Year Ended December 31, 2011 Particular Amount in $ Revenue 120000 Less Expanses -82000 Income 38000 Statement of Changes in Stockholders’ Equity Particular Amount in $ Opeaning Balce 0 Addition 160000 Add: Profit of the year 38000 198000 Less : Withdrowal -15000 Ending Balance 183000 Statement of Cash Flows For the Year Ended December 31, 2011 Particular Amount in $ Amount in $ Cash Flows From Operating Activities: Inflow from Revenues 120000 Outflow for Expenses -82000 Net Cash Flow from Operating Activities 38000 Cash Flows From Investing Activities 0 Cash Flows From Financing Activities: Inflow from Partners 160000 Outflow for Partners’ Withdrawals -15000 Net Cash Flow from Financing Activities 145000 Net Change in Cash 183000 Plus: Beginning Cash Balance 0 Ending Cash Balance 183000 Upton Company Financial Statements Balance Sheet As of December 31.2011 Particular Amount in $ Amount in $ Assets Cash 183000 Total Assets 183000 Liabilities Equity Dan Upton, Capital 106200 Nancy Upton, Capital 76800 Total Liabilities and Equity 183000 Capital Balance Particular Amount in $ Beginning Capital Balance 0 Plus: Capital Acquired from Owners 160000 Plus: Net Income 38000 Less: Withdrawals by Owners -15000 Ending Capital Balance 183000 Analysis Of Capital Dan Nancy Total Beginning Capital Balance 0 0 0 Investment 100000 60000 160000 Net Income 15200 22800 38000 Withdrowal -9000 -6000 -15000 Ending Capital Balance 106200 76800 183000 *Dan: $38,000 x 40% = $15,200 Nancy: $38,000 x 60% = $22,800

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