Practice Exercise - Cobble Hill Part 1 - Blank Strictly Confidential
Table of Contents
Cobble Hill Financial Statements
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Construct Financial Statements for Cobble Hill Inc.
Produce a Balance Sheet and Income Statement for Cobble Inc. for Year 1
Transactions
YEAR 1
Issues common shares 1,000
Borrows 400
Repays loan
Pays interest 24
Buys property and plant 900
(10 year estimated useful life)
Buys inventory 350
Cash paid for inventory 320
Sells inventory 510
Cash received from sales 430
Inventory left at year end 60
Pays expenses 40
Pays tax at 30% 20
Pays a dividend 30
Practice Exercise - Cobble Hill Part 1 Page 3 of 8
Balance Sheet
ASSETS YEAR 1
Current Assets
Cash 496 ☑️
Accounts Receivable 80 ☑️
Inventory 60 ☑️
Total Current Assets 636
Non-Current Assets
Property, Plant & Equipment 810 ☑️
Total Non-Current Assets 810
Total Assets 1,446
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts Payable 30 ☑️
Total Current Liabilties 30
Non-Current Liabilities
Long-Term Debt 400 ☑️
Total Non-Current Liabilities 400
Shareholders' Equity
Common Shares 1,000 ☑️
Retained Earnings 16 ☑️
Total Shareholders' Equity 1,016
Total Liabilities & Equity 1,446
Total Assets 1,446
Total Liabilities & Equity 1,446
Difference – COMPLETE
Practice Exercise - Cobble Hill Part 1 Page 4 of 8
Income Statement
YEAR 1
Revenues 510 ☑️
Cost of Sales (290) ☑️
Gross Profit 220
Other Operating Expenses (40) ☑️
EBITDA 180
Depreciation (90) ☑️
Operating Profit (EBIT) 90
Interest Expenses (Finance Cost) (24) ☑️
Profit Before Tax (EBT) 66
Tax Expense at 30% (20) ⬜
Net Income (EAT) 46
Dividends (30) ☑️
Retained Earnings 16
Practice Exercise - Cobble Hill Part 1 Page 5 of 8
Construct Financial Statements for Cobble Hill Inc.
Produce a Balance Sheet and Income Statement for Cobble Inc. for Year 1
Transactions
YEAR 1
Issues common shares 1,000
Borrows 400
Repays loan
Pays interest 24
Buys property and plant 900
(10 year estimated useful life)
Buys inventory 350
Cash paid for inventory 320
Sells inventory 510
Cash received from sales 430
Inventory left at year end 60
Pays expenses 40
Pays tax at 30% 20
Pays a dividend 30
Practice Exercise - Cobble Hill Part 1 Page 6 of 8
Balance Sheet
ASSETS YEAR 1
Current Assets
Cash 496
Accounts Receivable 80
Inventory 60
Total Current Assets 636
Non-Current Assets
Property, Plant & Equipment 810
Total Non-Current Assets 810
Total Assets 1,446
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts Payable 30
Total Current Liabilties 30
Non-Current Liabilities
Long-Term Debt 400
Total Non-Current Liabilities 400
Shareholders' Equity
Common Shares 1,000
Retained Earnings 16
Total Shareholders' Equity 1,016
Total Liabilities & Equity 1,446
Total Assets 1,446
Total Liabilities & Equity 1,446
Difference –
Practice Exercise - Cobble Hill Part 1 Page 7 of 8
Income Statement
YEAR 1
Revenues 510
Cost of Sales (290)
Gross Profit 220
Other Operating Expenses (40)
EBITDA 180
Depreciation (90)
Operating Profit (EBIT) 90
Interest Expenses (Finance Cost) (24)
Profit Before Tax (EBT) 66
Tax Expense at 30% (20)
Net Income (EAT) 46
Dividends (30)
Retained Earnings 16
Practice Exercise - Cobble Hill Part 1 Page 8 of 8
