Problem 2-1: Preparing Financial Statements
Information below is for Buraydah Manufacturing, Inc. for the year ended December 31, 20×1 except where beginning of year numbers indicated. All amounts in SAR unless otherwise stated.
Cost of goods sold
Short term notes payable
Marketing, general and administrative expenses
Long term debt
Fixed assets (property & equipment)
Retained earnings at beginning of year
Number of shares of common stock
Using the information above:
1. Prepare an income statement in good form
2. Prepare end of year balance sheet in good form
3. Calculate net working capital
4. Calculate the debt ratio
Using an additional column for each financial statement:
5. Prepare a common sized income statement
6. Prepare a common sized balance sheet
Problem 2-2 Preparing Statement of Cash Flows
Given the following information, prepare a statement of cash flows.
Increase in common stock
Decrease in accounts receivable
Increase in inventories
Increase in accounts payable
Increase in long term debt
Increase in fixed assets
Beginning cash balance
Assume all amounts are in 000’s SAR.
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