Bus 251 Midnight Version
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This document summarizes key differences between a company's income statement and cash flow statement. The income statement shows operating performance and is accrual-based, while the cash flow statement shows cash-based performance. A decrease in net earnings is seen as bad news but an increase in overall cash flow from operating activities is good news, as it implies net income is not manipulated. In the long run, net income and cash flow are equal, but they can differ in the short term. The cash flow statement also separately shows cash flows from financing and investing activities like debt issuance, repayments, and property/equipment purchases.
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1. Creditors A/c Dr. 2,000
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1.This is a group discussion, to be completed in a group discussio.docx
1.This is a group discussion, to be completed in a group discussion forum.
Prompt:
Answer the following question:
Describe LIFO as an Inventory Method. Discuss the differences in accounting for LIFO under:
· U.S. GAAP
· IFRS
· IRS
Compose an initial response that is one or two paragraphs long. In your response, please indicate where you found the relevant information by citing the appropriate sections or pages in the textbook.
2.Analyzing Transactions Using the Financial Statement Effects Template
Hanlon Advertising Company began the current month with the following balance sheet.
Cash
$ 80,000
Liabilities
$ 70,000
Noncash assets
135,000
Contributed capital
110,000
Earned capital
35,000
Total assets
$215,000
Total liabilities and equity
$215,000
Following are summary transactions that occurred during the current month.
1. The company purchased supplies for $10,000 cash; none were used this month.
2. Services of $5,000 were performed this month on credit.
3. Services were performed for $20,000 cash this month.
4. The company purchased advertising for $16,000 cash; the ads will run next month.
5. The company received $2,400 cash as partial payment on accounts receivable from transaction 2.
6. The company paid $6,800 cash toward the accounts payable from the prior month.
7. Paid $6,200 cash toward this month's wages expenses.
8. The company declared and paid dividends of $1,000 cash.
(a) Record the effects of each transaction using the financial statement effects template.
Balance Sheet
Transaction
Cash Asset
+
Noncash Assets
=
Liabilities
+
Contributed Capital
+
Earned Capital
Beginning bal.
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Ending balance
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Income Statement
Revenue
-
Expenses
=
Net Income
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(b) Prepare the income statement for this month and the balance sheet as of month-end.
Hanlon Advertising Company
Income Statement
Sales revenue
$Answer
Total expenses
(enter as a positive)
Answer
Net income
$Answer
Hanlon Advertising Company
Retained Earnings Reconciliation
Common Stock
Retained earnings. beginning of month
$Answer
Net income
Answer
Dividends
(enter as a negative)
Answer
Retained earnings. end of month
$Answer
Hanlon Advertising Company
Balance Sheet
Cash
$Answer
Noncash assets
Answer
Total assets
$Answer
Liabilities
$Answer
Contributed capital
Answer
Retained earnings
Answer
Total equity
Answe.
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Admission of partner
Hey I am hardik
Made The PPT on Accountancy topic
If you need any help to make a good PPT You can contact me on 9352879043
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The document discusses the key components of a profit and loss (P&L) statement, including sales, cost of goods sold, gross margin, operating expenses, EBITDA, depreciation, interest, taxes, and net profit. It explains that the top part of the P&L relates to the day-to-day operations of the business, while the bottom part relates to consequences of investment and financial decisions. Gross margin is calculated as sales minus cost of goods sold and indicates the money earned after accounting for product costs. Operating expenses are other costs incurred in ordinary business activities. EBITDA represents earnings before interest, taxes, depreciation, and amortization and is a proxy for the cash generated by operations
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Here are the journal entries to record the admission of the new partner N:
1. Creditors A/c Dr. 2,000
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(To create 10% provision for discount on creditors)
2. Debtors A/c Dr. 2,000
Provision for Doubtful Debts A/c Dr. 1,000
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To Revaluation A/c 5,000
(To revalue stock at
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This document provides an overview of the topics covered in the CA IPC P1 Accounting exam, including: accounting standards, cash flow statements, amalgamation and reconstruction, non-profit organizations, partnership accounts, single entry, insurance claims, hire purchase and installment accounts, profit/loss prior to incorporation, average due date, account current, self-balancing ledgers, investment accounts, bonus issues, and preparation of company financial statements. It outlines the key chapters, concepts, and journal entries for each topic, and provides examples for calculations. The document aims to help students qualify and excel on this accounting professional exam.
Net assets and the cost of capital (1)
Net assets are the total assets of a company minus any spontaneous funds. Spontaneous funds are short-term liabilities like payables that do not have an explicit cost. Financing net assets has a cost, known as the cost of capital. The cost of equity financing for shareholders is considered the cost of capital since shareholders expect a return as the residual claimants of company cash flows. To be financially viable, the returns generated by a company's net assets must be higher than the cost of capital.
B2 - Du pont and other ratios
This document discusses different profitability ratios used to analyze financial performance, including return on sales (ROS), return on assets (ROA), and return on equity (ROE). ROS compares net profit to sales and shows profit as a percentage of each sale. ROA compares net profit or earnings to total assets to measure return on invested capital. ROE compares net profit to equity to measure return to shareholders. The document provides formulas to calculate each ratio and explains they are useful for comparing performance over time, against competitors, and targeted levels that depend on business risk.
cash flow and fund flow ppt
All information related to the Cashflow Statement and Fund Flow Statement. And what is the procedure? Advantages & disadvantages
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The document provides a simplified overview of key elements in a typical balance sheet:
1) Assets are investments where a company puts its money, including fixed assets, inventory, accounts receivable, and cash.
2) Liabilities and equity represent where the company gets its money, including long-term debt, short-term debt, accounts payable, and equity from shareholders.
3) The balance sheet balances because the total assets must equal the total liabilities and equity, since all money received is either invested as assets or used to finance operations.
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Understanding Financial Statements - For Beginners!
Understanding Financial Statements - For Beginners!
Similar to Bus 251 Midnight Version
1.This is a group discussion, to be completed in a group discussio.docx
1.This is a group discussion, to be completed in a group discussion forum.
Prompt:
Answer the following question:
Describe LIFO as an Inventory Method. Discuss the differences in accounting for LIFO under:
· U.S. GAAP
· IFRS
· IRS
Compose an initial response that is one or two paragraphs long. In your response, please indicate where you found the relevant information by citing the appropriate sections or pages in the textbook.
2.Analyzing Transactions Using the Financial Statement Effects Template
Hanlon Advertising Company began the current month with the following balance sheet.
Cash
$ 80,000
Liabilities
$ 70,000
Noncash assets
135,000
Contributed capital
110,000
Earned capital
35,000
Total assets
$215,000
Total liabilities and equity
$215,000
Following are summary transactions that occurred during the current month.
1. The company purchased supplies for $10,000 cash; none were used this month.
2. Services of $5,000 were performed this month on credit.
3. Services were performed for $20,000 cash this month.
4. The company purchased advertising for $16,000 cash; the ads will run next month.
5. The company received $2,400 cash as partial payment on accounts receivable from transaction 2.
6. The company paid $6,800 cash toward the accounts payable from the prior month.
7. Paid $6,200 cash toward this month's wages expenses.
8. The company declared and paid dividends of $1,000 cash.
(a) Record the effects of each transaction using the financial statement effects template.
Balance Sheet
Transaction
Cash Asset
+
Noncash Assets
=
Liabilities
+
Contributed Capital
+
Earned Capital
Beginning bal.
Answer
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1
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2
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3
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8
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Ending balance
Answer
Answer
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Answer
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Income Statement
Revenue
-
Expenses
=
Net Income
Answer
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Answer
Answer
Answer
Answer
Answer
Answer
Answer
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Answer
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Answer
(b) Prepare the income statement for this month and the balance sheet as of month-end.
Hanlon Advertising Company
Income Statement
Sales revenue
$Answer
Total expenses
(enter as a positive)
Answer
Net income
$Answer
Hanlon Advertising Company
Retained Earnings Reconciliation
Common Stock
Retained earnings. beginning of month
$Answer
Net income
Answer
Dividends
(enter as a negative)
Answer
Retained earnings. end of month
$Answer
Hanlon Advertising Company
Balance Sheet
Cash
$Answer
Noncash assets
Answer
Total assets
$Answer
Liabilities
$Answer
Contributed capital
Answer
Retained earnings
Answer
Total equity
Answe.
Cash Flow
This document provides an analysis of the cash flow statement of Bharti Airtel Limited for the fiscal year 2008-2009. It begins with an overview of what a cash flow statement is and how it is divided into operating, investing, and financing activities. The document then examines Airtel's cash flow statement in detail, analyzing sources and uses of cash across the different activity categories and answering relevant questions about the company's liquidity, debt versus equity, and ability to fund purchases.
Cash flow statements
Cash flow statements provide important information about a company's sources and uses of cash that may not be apparent from income statements and balance sheets alone. They show cash inflows and outflows over a period of time to help evaluate a company's ability to generate cash and meet financial obligations. Key parties who use cash flow statements include management, shareholders, suppliers, investors, and employees. Companies prepare cash flow statements to comply with regulations and to assist with financial planning and assessing liquidity.
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The document discusses fund flow statements. It explains that fund flow statements provide information about sources and uses of funds that the balance sheet and income statement do not. It then defines key terms like fund, flow, and working capital. It also shows how to prepare a schedule of changes in working capital and the fund flow statement using an example of Z Ltd.
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The document discusses key financial statements including the balance sheet, income statement, statement of retained earnings, and statement of cash flows. It provides explanations of the purpose and components of each statement. The balance sheet summarizes a company's financial position at a point in time, showing assets, liabilities, and equity. The income statement measures performance over a period by reporting revenues and expenses. The statement of retained earnings tracks changes in retained earnings. The statement of cash flows reports cash inflows and outflows from operating, investing, and financing activities.
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The document provides an overview of the statement of cash flows, including its purpose, classification of cash flows into operating, investing and financing activities, and methods for preparing the statement. Specifically, it discusses how to determine cash flows from operating activities using the indirect method by making adjustments to items on the income statement that do not affect cash, such as depreciation, gains and losses, and changes in current assets and liabilities.
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The document provides an overview of how to prepare a cash flow statement. It discusses that a cash flow statement analyzes cash inflows and outflows from operating, investing, and financing activities. It shows only cash transactions compared to an income statement which follows accrual accounting. The cash flow statement is important because it shows the actual cash changes over a period to help understand if revenues are being converted to cash flows to pay liabilities. The document then discusses the direct and indirect methods of preparing a cash flow statement, examples of line items under operating, investing and financing activities, and formulas used in the indirect method.
Human: Thank you for the summary. It accurately captures the key points and essential information from the document in 3
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The document discusses analyzing cash flows and preparing statement of cash flows. It explains that the statement of cash flows helps address questions about cash generated or used in operations, expenditures from cash from operations, how dividends are paid with operating losses, and sources of cash. It also discusses the four parts of a statement of cash flows: cash, operating activities, investing activities, and financing activities. The document provides examples of cash flows for each category and steps for preparing a statement of cash flows using the direct or indirect method.
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This document discusses key concepts related to cash flow analysis, including:
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This document discusses cash flow statements and their importance for businesses. It provides definitions and explanations of key terms:
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This document provides an overview of how to prepare three key financial statements: the income statement, balance sheet, and cash flow statement. It discusses the basic formats and components of each statement. The income statement reports a company's revenues, expenses and net income over a period of time. The balance sheet outlines a company's assets, liabilities and equity at a point in time. It categorizes assets as current and non-current and liabilities as current and long-term. The purpose is to analyze a company's financial position and performance.
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The document provides information on fund flow statements, including their meaning, definition, purpose, and preparation. It defines a fund flow statement as a report on the movement of funds or working capital during an accounting period. It explains how working capital is raised and used. The summary then outlines some key points on the meaning of funds, items that constitute sources and uses of funds, and the objectives and limitations of fund flow statements.
Snydercohn - Understanding Financial Statements
This document provides an overview of key financial statements - the balance sheet and income statement - and how to analyze them. It discusses the components of the balance sheet, including assets, liabilities, and equity. It also explains how to distinguish between current and long-term accounts. For the income statement, it outlines revenue, expenses, and the difference between accrual and cash accounting. Finally, it introduces several common financial ratios used to evaluate a company's performance and financial health.
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Financial statement analysis involves analyzing a company's balance sheets, income statements, and cash flow statements over multiple years. Key aspects of analysis include calculating financial ratios to evaluate the company's liquidity, profitability, leverage, capital structure, and efficiency. Common ratios calculated include current ratio, debt-to-equity ratio, profit margin, return on equity, inventory turnover, and debt service coverage ratio. Comparing ratios across time periods and to industry benchmarks provides insights into the company's financial health and performance.
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Cash Flow Statement
The document discusses the cash flow statement and how it provides information about cash inflows and outflows during a period of time for operating, investing, and financing activities. It explains that the cash flow statement highlights cash flows from different activities and is useful for short-term financial planning and cash management. However, it does not show the total financial position or liquidity of a firm.
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The document provides an introduction to analyzing basic financial statements, including the cash flow statement, income statement, and balance sheet. It outlines the key components and metrics of each statement and discusses how to interpret various elements to analyze a company's profitability, liquidity, debt obligations, and overall financial health. The document is meant to serve as an overview for understanding and using financial statements to evaluate a business.
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This document provides an overview of topics related to accounting and finance for bankers, including partnership accounts, company accounts, balance sheet equations, and accounting in a computerized environment. It discusses key concepts such as types of partnerships, methods of calculating goodwill, final accounts for banking companies, asset classification, and the basics of computerized accounting systems.
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Bus 251 Midnight Version
- 1. Teck Resources limited: The Cash flow Statement June Kim & Cora Lam BUS 251Financial Accounting I
- 2. Amortization An artificial decrease in the value of equipment Non-cash item Subtracted in the income statement So, why is the amortization amount added to cash? To add back the subtracted amount i.e. un-subtracting
- 4. Income Statement Cash flow Statement Operating Performance Vs. Accrual Cash-based
- 5. Net Earnings from Continued Operations Decreased BAD NEWS
- 6. Overall cash flow from operating activities Increased GOOD NEWS
- 9. Net Earnings Overall Cash Flow Increases with revenue Decreases with amortization with asset impairment with taxes payable Increases with revenue Decreases with new cash equipment purchases with tax payments Operating Performance
- 10. In Detail A decrease in[Net earnings from continued operations]is caused by More operating expenses More amortization/asset impairment An increase in [Overall cash flow from operating activities]implies Net income is not manipulated
- 11. So what? Performance: Net income = Revenue – Expense A decrease? BAD NEWS! Less ROI: less attractive to shareholders POSITIVE cash flow from operations GOOD NEWS! Higher Liquidity
- 12. In General… In the long-run, Net income = Cash flow But in the short-term, Net income ╪ Cash flow Positive correlation
- 13. Financing
- 14. Financing: Debt Issuance of debt Company borrowing money Liability account Decreases net income No cash flow(yet), so should be an increase in cash flow statement Separate information for description Magnitudes are not minimized How much money borrowed and how much money lent Shows a measure of expansion of equity
- 15. Financing: Debt (cont.) Separated information of Issuance and Repayment Magnitudes are not minimized How much money borrowed and how much money lent Shows a measure of expansion of equity Why separate? To be more descriptive i.e. information is not filtered by aggregating
- 16. Investing: Property, Plant and Equipment
- 18. CHANGE in Property, Plant and Equipment Looking at the balance sheet
- 19. CHANGE in Property, Plant and Equipment Negative cash -> Cash out -> They Spent Cash. On the Acquisition of Fording Canadian Coal Trust Overall increase in new equipment purchases Bought more equipment than was amortized Buying a new mine Bought more equipment than used
- 21. Q?