With the balance sheet information from, and the additional information from the income statement and statement of retained earnings, prepare the motel’s statement of changes to working capital for the year ending December 31, 2005.
|
Income Statement for Year Ended December 31, 2005 |
|
|
Sales revenue |
$204,900 |
|
Operating costs |
(173,800) |
|
Income before depreciation and interest and tax |
31,100 |
|
Depreciation, building |
(8,300) |
|
Depreciation, furniture and equipment |
(3,700) |
|
Income before interest and tax |
$19100 |
|
Interest |
(10800) |
|
Operating income (before tax) |
$8300 |
|
Income tax |
(1500) |
|
Net income |
$6800 |
|
Statement of Retained Earnings for Year Ended December 31, 2005 |
|
|
Retained earnings, January 1, 2005 |
$ 22,800 |
|
Add: Net income for year |
6800 |
|
Subtotal |
$29600 |
|
Deduct: Dividends paid |
(3200) |
|
Retained earnings December 31, 2005 |
$26,400 |