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Class Case

In: Business and Management

Submitted By uribelov
Words 293
Pages 2
CASE 3

On January 1 stockholders invest 500.000 Euro cash in an enterprise to be known as EA Corporation.
During 2012 EA corporation: - purchased raw material for an amount of 200.000 Euro (cash payment) - collected a 500.000 Euro loan from a Bank; - purchased plant and machinery for 400.000 Euro (deferred payment) - purchased a piece of land for 100.000 (cash payment) - paid employee salaries of 50.000 Euro - sold products for an amount of 350.000 Euro (cash collection) - Raw materials in inventory at 31st December are 15.000 Euro - The estimate useful life for plant and machinery is 10 years

The student compiles the balance sheet, the income statement and the cash flows statement of the EA corporation at the end of 2012.

During 2013 EA corporation: - purchased raw material for an amount of 110.000 Euro (deferred payment) - paid employee salaries of 60.000 Euro - sold products for an amount of 300.000 Euro (cash collection) - sold the piece of land for an amount of 95.000 (cash collection) - Raw materials in inventory at 31st December are 7.000 Euro

The student compiles the balance sheet, the income statement and the cash flows statement of the EA corporation at the end of 2013.

During 2014 EA corporation: - Paid the total amount of account payable - purchased raw material for an amount of 100.000 Euro (cash payment) - paid employee salaries of 50.000 Euro - sold products for an amount of 210.000 Euro (deferred collection) - paid dividend to the shareholder for 50.000 - Raw materials in inventory at 31st December are 7.000 Euro

The student compiles the balance sheet, the income statement and the cash flows statement of the EA corporation at the end of 2014.

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