completed Statement of Owner Equity, a completed Cash Flow S…

Use the Excel template file provided to submit a completed Statement of Owner Equity, a completed

Cash Flow Statement, and answers to the short questions

Dont forget to answer the short answer questions.

1. Using the information below, construct a Statement of Owners Equity for the period Jan. 1,

2023 to Dec. 31, 2023 for the Illini Tap. Some of the items may not be used, some are completed

for you, and others may require additional calculation before entering onto the form.

Complete the SOE and worksheet using the information below.

The cells shaded in gray in the Excel file already include the subtotal calculations needed, and a few

values have been completed for you. Subtotals will update as you add items.

Hint: Complete the Change in Market Valuation section first, then complete the change in

Contributed Capital and Retained Earnings section. This is very similar to the in-class example we

did for the SOE.

Excess of Market over Book Values (Market – Book)

Item: 12/31/2022 12/31/2023 Change

Machinery and Equipment -$5,000 -$13,000

Land $5,500 $7,000

Buildings $6,500 $10,000

Marketable Securities $12,000 $19,000

Other Investments (local brewery) $15,000 $18,000

Selected Account Balances:

Current Deferred Taxes $7,526 $11,552

Non-current Deferred Taxes $124 $739

Non-real estate long-term loan balance $165,000 $164,000

Total Equity $237,100 $270,662 $33,562

Other Information:

2023 Net Income for Illini Tap was: $133,677

No capital contributions or distributions were made in 2023

2

2. Using the information below, construct the 2023 Statement of Cash Flows for the Illini Tap.

Some of the items may not be used, a few are completed for you as examples, and other items

may require intermediate calculations before entering on the CFS.

Remember, you need to calculate Family Living Withdrawals on the SOE, and then use the

same value on the Cash Flow Statement.

Record which section each item is recorded on the SCF worksheet (Operating, Investing, or

Financing). Note any assumptions that you make in the notes section of the SCF worksheet.

The cells shaded in gray in the Excel file already include the subtotal calculations needed, and a few

values have been included for you. Subtotals will update as you add items.

Hint: Family Living Withdrawals needs to come from the value you calculated on the SOE.

Section

on CFS 2023 Transactions Notes

a Land and building purchase

Land Cost 150,000

Building Cost 300,000

Down Payment 20,000

Remainder financed on 30-year loan ???

b Bar Equipment Purchase

Cost of new equipment 85,000

Down Payment 5,000

Remainder financed on 5-year loan ???

c Sold equipment

Sale price 10,000

Tax basis of equipment sold 15,000

d Investment in local brewery

Original cost in 2021 58,000

Current value 75,000

Dividends received in 2023 3,000

Other items:

e Principal paid on short-term loans 16,000

f Interest paid on short-term loans 2,500

g Family Living Withdrawals ???

h Operating Total Cash Sales 910,000 Operating inflow

i Principal paid on long-term loans 14,000

j Operating Operating outflow

k Total Cash Operating Expenses 660,000

l Interest paid on long-term loans in cash 19,000

m Cash Tax Expenses 65,000

Deposit to Savings Account 25,000

Beginning Cash Balance 187,000 Beginning Cash Balance

3

Short Answer:

3. Explain the three components of owners equity and describe how each component could

potentially show a negative value. (10 pts)

4. Explain the purpose of the cash flow statement and what some of the major differences between

the income statement and cash flow statement are. (10 pts)

As usual, note the items/information NOT used on the SOE and SCF and briefly

explain why they were not included.