Lone Pine Cafe

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Noncurrent assets
Property, plant and
equipment:
Equipment

Noncurrent assets

$ 48 000.00

$ 54 600.00

Total Assets:

Assets
Current assets
Cash
Inventories
Prepaid Expenses
Accounts receivable
Total Current assets:

$ 21 000.00

Owners' equity:
Paid-in capital:

Assets
Current assets
Cash
$ 10 172.00
Inventories
$ 2 800.00
Prepaid Expenses
$ 1 428.00
Total Current assets:
$ 14 400.00

Lone Pine Cafe
Balance sheet
As of November 2, 2009
Liabilities and Owners' equity
Current liabilities
Notes payable, bank

$ 69 000.00

Total Liabilities and Owners' equity: $ 69 000.00

Lone Pine Cafe
Balance sheet
As of March 30, 2010
Liabilities and Owners' equity
Current liabilities
Accounts payable
$ 1 583.00
Notes payable, bank
$ 18 900.00
Total current liabilities:
$ 20 483.00

$ 1 341.00
$ 2 430.00
$
833.00
$
870.00
$ 5 474.00

Owners' equity:

Property, plant and
equipment:
Equipment
$ 54 600.00
Less: Accumulated
Depreciation
$ -2 445.00
Property, plant,
equipment— net
$ 52 155.00
Total Assets:

Paid-in capital:

Net loss

$ 57 629.00

Total liabilities and owners' equity:

Lone Pine Cafe
Income Statement
For November 2, 2009 to March 30, 2010
Sales revenue
Cost of sales
Cross margin
Selling, general, and administrative expenses
Operating loss
Other revenues (expenses):
Interest expense
Loss before income taxes
Provision for income taxes
Net loss

$ 37 146.00

$
$
$
$
$

44 350.00
11 969.00
32 381.00
42 695.00
-10 314.00

$
540.00
$ -10 854.00
$
$ -10 854.00

Net sales = cash received from customers 43 480 + accounts receivable 870 Cost of sales = payed for food and beverages at the beginning 2 800 + amounts owed to suppliers 1 583 - food and beverages left over 2 430 + food and beverage suppliers 10 016 Selling, general, and administrative expenses = local operating licenses 1 428/12*5 + depreciation on the assets 2 445 + monthly payments to partners 23 150 + wages to part-time employees 5 480 + telephone and electricity 3 270 + miscellaneous 255 + rent payments 7 500

$ 57 629.00

3. Disregarding the marital complications, do you suppose that the partners would have been able to receive their proportional share of the equity determined in Question 2 if the partnership was dissolved on March 30, 2010? Why?

If Mr.Antoine and Mrs.Landers would dissolve the partnership on March 30, 2010, then they would NOT have been able to receive their proportional share of the equity determined in Question 2. If entity would sell equipments, inventories, receive the money from accounts receivable, the money gained togather with cash wouldn't be able to disburse the liabilities. There would be loss which partners would have to disburse from their paid-in capital. 2. What does this income statement tell Mrs. Antoine?

The income statement tells that the first 5 months Lone Pine Cafe worked with loss. Although the cost of sales were less then the sales revenues, selling and administrative expenses made the loss for these 5 months.

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