Assume this is the first year of your business and use the week 4 profit and loss statement from year 1 for the purpose of creating your balance sheet and cash flow statement. Create a properly formatted balance sheet addressing the instructor’s findings from previous class assignment by doing the following: Review the revenue and expense items based on comments made by the instructor, if any, from week four to best estimate realistic values for the balance sheet.
Create a properly formatted cash flow statement addressing the instructor’s findings from previous class assignment by doing the following: Review the revenue and expense items based on comments made by the instructor, if any, from week four to best estimate realistic values for the cash flow statement. Conduct an internet search for or use an example located in the textbook as a template to create a properly formatted balance sheet and cash flow statement. I will also provide an example which was posted in class in week four and will repost in week five which shows all three financial statements with sample data and how they are connected and prepared.
Using a Microsoft Word document explain the order in which the financial statements are prepared and how they are connected. The balance sheet and cash flow statement can be in Microsoft Excel or Microsoft Word, but please provide the solution to part 4 in Microsoft Word. Format assignment consistent with APA guidelines. Submit your assignment.
Explanation of cost of sales the cost of sales for the services provided has been based on the assumption of 45% of the total sales in the first year and second year. Furthermore, the increase in the cost of sales during the third year is identified as 48%, fourth year as 50% and fifth year as 52% respectively. Such an estimation for the cost of sales is based on improving the quality of coffee beans in the later years of operations (Ferreras-Garcia, Hernández-Lara and Serradell-López 2019).
Explanation of operating expenses the operating expenses for the business mainly include rent for the premises, salaries, payroll tax, accounting fees, postage and cellular charges, sales and marketing, supplier contracts, lease payments, preliminary expenses, market survey, interest on loan, logo designs and brochures.
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