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Creating an income statement and balance sheet

Create an income statement and a balance sheet for years Y1 through Y5. You must use the accrual basis of accounting and apply GAAP accounting principles. Include the following five items on a separate sheet in the same EXCEL worksheet file: balance sheet; income statement; calculation of cost of goods sold, purchases, and ending inventory; calculation of ending cash balance; cash collections of accounts receivable and cash payments of other current liabilities.

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Attached is a dynamic Excel file with the suggested solution. You ...

Solution Summary

You will see all formulas and relevant links inside the calculated fields. If you change the figures in the assumptions or/and in the statements of Y0, all subsequent years' amounts will change automatically.