EXCERCISE: COMMERCIAL FIRM FROM CARIBBEAN - HELP ANYONE (ACCOUNTING)
The President of the Caribbean COMMERCIAL company is requesting the Income Statement.
For this purpose, we have the following information: We are on December 31st.
1. We know that this year we have collected the sales amount from December of last year, totaling 10,000 euros.
2. We also know that this year we have sold 180,000 euros and that we collect within 60 days. Therefore, this year, we have only collected 150,000 euros from these sales.
In case anyone gets confused: Monthly sales are 15,000 euros. If the company sells on credit for 60 days, it means that sales from the last two months will be collected next year, not this year.
3. This year, we purchased merchandise amounting to 90,000 euros, payable within 90 days according to the agreement with suppliers. At the beginning of the year, there was merchandise in stock worth 8,000 euros, and at the end of the year, there is merchandise worth 18,000 euros. The same quantity is purchased every month.
From here, it can be easily deduced what the cost of sales is. It's quite logical: In other words, think about it: How much did it cost us to sell what we have sold? How much did we sell? (At the cost price, at the purchase price)
4. This year, we have paid the debt we had with suppliers for purchases made last year, amounting to 15,000 euros.
5. We emailed the accountant to ask about depreciation, and he told us that for this year, based on the acquisition cost of each fixed asset, its useful life, and the acquisition date, the depreciation for this year amounts to 7,000 euros.
6. The electricity, water, and gas consumption for the entire year totals 12,000 euros and is paid on the 1st or 2nd day of the following month, depending on whether it falls on a Sunday or not. The suppliers changed the payment system; last year, it was paid on the last day of the month, so there are no general expenses from the previous year that we have to pay this year.
7. On January 1st, there was 1,800 euros in the bank.
8. The remaining general expenses are paid on the last day of each month, and their annual amount is 3,000 euros.
9. We know that this year an investment of 4,000 euros was made to renew a sorting machine, and it was paid in cash.
10. Personnel expenses amount to 52,000 euros. This includes the payroll, 40,000 euros, and 12,000 euros, which is the company's contribution to social security financing. We already know that the december “Employer’s Contribution”, which amounts to 1,000 euros, will be paid to Social Security in January of next year.
11. But this year, the company had to pay the december “Employer’s Contribution” from the previous year, which amounted to 800 euros.
12. This year, one-fourth of the loan of 24,000 euros granted by the Bank of Santo Domingo has been amortized.
13. The financial expenses for this year, resulting from outstanding loans and the negotiated interest rate, amounted to 1,200 euros
14. At the end of the year, a short-term credit was contracted with ANOTHER BANK amounting to 4,000 euros, deposited into the current account on December 31st, at a 7% interest rate. The study fees for the credit approval amount to 180 euros.
15. The Profit Tax (before taxes) is 20%. The good thing is that it doesn't have to be paid until next year, but this year we had to pay the Profit Tax from last year.
16. Last year, there was a profit before taxes of 8,000 euros. The tax rate was 20%. This year, we had to pay the profit tax for the previous year.
NOTE: Those already initiated may have noticed that we are not taking into account the fiscal part represented by the withholding tax on workers. This is to avoid complicating it further; it is not of greater importance for didactic purposes; the behavior is the same as with Social Security, it is generated in December this year but is paid the following year.
What is the value of Gross Margin? Why is Gross Margin so important? Do you know what the value of ROS (Return on Sales) is, and what does it mean?
I have attached a word file with the Income Statement needed to be completed
