Financial Accounting: An Integrated Statements Approach, 2nd Edition

The following financial data were adapted from the annual report of Best Buy Inc.for the period

ending February 28, 2004:

In millions

Accounts payable $ 2,535

Accrued liabilities 1,598

Capital stock 954

Cash 2,600

Cost of goods sold 18,350

Income taxes 496

Interest expense and other items 103

Inventories

Fixed Assets and Intangible Assets

Other assets 344

Other liabilities 1,097

Property, plant, and equipment 2,244

Receivables

Sales 24,547

Selling, general, and administrative expenses 4,893

Instructions

1. Prepare Best Buy’s income statement for the year ending February 28, 2004.


2. Prepare Best Buy’s retained earnings statement for the year ending February 28, 2004.
   (Note: The retained earnings at February 28, 2003, was $1,893. During the year, Best Buy
   paid dividends of $130.)


3. Prepare a balance sheet as of February 28, 2004, for Best Buy.

The following cash data were adapted from the annual report of Apple Computer Inc.for

the period ended September 25, 2004. The cash balance as of September 26, 2003, was $3,396

(in millions).

In millions

Receipts from issuing capital stock $ 427

Payments for property, plant, and equipment 176

Payments for purchase of other investments 1,312

Payments for long-term debt 300

Net cash flows from operating activities 934

Instructions

Prepare Apple’s statement of cash flows for the year ended September 25, 2004.

Conwell Corporation began operations on January 1, 2007, as an online retailer of computer soft-

ware and hardware. The following financial statement data were taken from Conwell’s records

at the end of its first year of operations, December 31, 2007.

Accounts payable $ 42,000

Accounts receivable 67,200

Capital stock 350,000

Cash?

Cash payments for operating activities 980,000

Cash receipts from operating activities 1,171,800

Cost of sales 560,000

Dividends 35,000

Income tax expense 196,000

Income taxes payable 28,000

Interest expense 21,000

42 Chapter 1 The Role of Accounting in Business

Problem 1-3A

Income statement, retained

earnings statement, and

balance sheet

Goal 4

Net income, $705

Problem 1-4A

Statement of cash flows

Goal 4

Net decrease in cash, $427

Problem 1-5A

Financial statements, including

statement of cash flows

Goal 4

1. Net income, $315,000