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![Statement of Comprehensive Income
[Company Name]
Income Statement
For the Year Ended
Revenue
Less: Operating Expenses
Earnings before interest and tax
Less: Interest expense
Less: Tax Expense
Net income after tax
[Company Name]
Income Statement
For the Year Ended
Sales
Less: Cost of goods sold
Gross profit
Less: Operating expenses
Earnings before interest and tax
Less: Interest expense
Less: Tax Expense
Net income after tax
Service Business
Merchandising and
Manufacturing
Business](https://image.slidesharecdn.com/ducojhoanamarielledemoteaching-220105170759/85/General-Purpose-Financial-Statements-36-320.jpg)
![Statement of Changes in Equity
[Company Name]
Statement of Changes in
Owner's Equity
For the Year Ended
[Name], Capital, beginning
Net income
Less: Withdawals
[Name], Capital, ending
[Company Name]
Statement of Changes in Partners' Equity
For the Year Ended
[Name],
Capital
[Name],
Capital
Capital balances, beginning
Additional investments
Net income
Less: Withdrawals
Capital balances, ending
Sole proprietorship
Partnership](https://image.slidesharecdn.com/ducojhoanamarielledemoteaching-220105170759/85/General-Purpose-Financial-Statements-40-320.jpg)
![Statement of Changes in Equity
[Company Name]
Statement of Changes in Shareholders' Equity
For the Year Ended
Common
stock
Paid-in
capital
Retained
earnings
Treasury
Stock
Total
Beginning balance
Issued shares
Net income
Less: Dividends
Ending balance
Corporation](https://image.slidesharecdn.com/ducojhoanamarielledemoteaching-220105170759/85/General-Purpose-Financial-Statements-41-320.jpg)
![Statement of Financial Position
Sole Proprietorship
[Name], Capital Partnership
[Name], Capital
[Name], Capital Corporation
Share Capital
Reserves/ Additional Paid-in
Capital
Accumulated profit/ loss
Less: Treasury shares](https://image.slidesharecdn.com/ducojhoanamarielledemoteaching-220105170759/85/General-Purpose-Financial-Statements-45-320.jpg)
![Statement of Financial Position
[Company Name]
Statement of Financial Position
As of the period
Assets
=
Liabilities
+
Equity
[Company Name]
Statement of Financial Position
As of the period
Assets
Liabilities
Equity
Report Form Account Form](https://image.slidesharecdn.com/ducojhoanamarielledemoteaching-220105170759/85/General-Purpose-Financial-Statements-46-320.jpg)
![Statement of Cash Flow
[Company name]
Statement of Casf Flow
Year Ended
Cash flow for operating activties
Cash from customers
Cash from suppliers
Cash for opeerating expenses
Cash for interest
Cash for taxes
Net cash provided for operating activities
Cash flow for investing activties
Cash flow for financing activties
Increase (decrease) in cash and cash equivalents
Cash and cash equivalents, beginning
Cash and cash equivalents, ending
[Company name]
Statement of Casf Flow
Year Ended
Cash flow for operating activties
Net income
Amortization expense
(Increase) decrease adjustments in net income
Increase (decrease) in current asset and liability
Net cash provided for operating activities
Cash flow for investing activties
Cash flow for financing activties
Increase (decrease) in cash and cash equivalents
Cash and cash equivalents, beginning
Cash and cash equivalents, ending](https://image.slidesharecdn.com/ducojhoanamarielledemoteaching-220105170759/85/General-Purpose-Financial-Statements-49-320.jpg)
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Similar to General-Purpose Financial Statements
General-Purpose Financial Statements
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- 2. U B LD M J R E T L E S E T Bring out your pen and paper.
- 3. R R EO P T 1
- 4. R R EO P T REPORT
- 5. S 2 C I EN D O I
- 6. S C IE N D O I DECISION
- 7. O D EI P R 3
- 8. O D EI P R PERIOD
- 9. Y N TI T E 4
- 10. Y N TI T E ENTITY
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- 14. Learning Outcomes After studyingthis topic, students are expected to be able to: ● Define financial statements; ● List the types of financial statements and their corresponding elements; ● Explain the purpose, underlying concepts, and format of financial statements; and ● Build a pro forma financial statement.
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- 16. - are collectionof summary-level reports about an entity’s financial results, financial position, and cash flows that are periodically communicated to the users. - are the end product or main output of the financial accounting process. Financial Statements
- 17. Trial Balance Ledger Journal SourceDocuments Financial Statements
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- 19. “To provide informationabout the financial position, financial performance, and cash flows of an entity that is useful to a wide range of users in making economic decisions.” General Purpose Financial Statement
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- 21. 1. Primary usersare present and potential investors, lenders, and other creditors. 2. Other users or the stakeholders. Users
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- 23. 1.Fundamental Qualities: A.Relevance - PredictiveValue - Confirmatory Value - Materiality B.Faithful Representation - Completeness - Neutrality - Free from error Qualitative Characteristic
- 24. Predictive Value Confirmatory Value Materiality used as aninput to predict future outcome of events nature and magnitude of items which it relates provides feedback of previous expectations A. Relevance “making difference in decisions made”
- 25. B. Faithful Representation Completeness Neutrality Free fromerror all significant information are clearly reported no errors or omission on the transaction information are free from bias “actual effects are accounted and reported”
- 26. 2. Enhancing Qualities: -Comparability - Verifiability - Timeliness - Understandability Qualitative Characteristic
- 27. Enhancing Qualities Timeliness Understandability noting pointsof likeliness and difference presented clearly and concisely reaching concensus available to influence decisions Comparability Verifiability
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- 30. 1. Statement ofComprehensive Income 2. Statement of Changes in Equity 3. Statement of Financial Position 4. Statement of Cash Flow 5. Notes to Financial Statements Types Relationship of Financial Statements
- 31. - assets - liabilities -equity - income and expenses, including gains and losses - contributions by owners - distribution to owners - cash flows Elements Chart of Accounts Assets (100-199) Liabilities (200-299) Equity (300-399) Income (400-499) Expenses (500-599) Normal Balances Assets Debit Contra Asset Credit Liability Credit Contra Liability Debit Equity Credit Withdrawal Debit Dvidends Debit Income Credit Expenses Debit Gains Credit Losses Debit
- 32. - is aformal statement showing the financial performance of an entity for a given period of time. Statement of Comprehensive Income Presentation Profit or Loss Other Comprehensive Income Two Statement Income Statement Statement of Comprehensive Income Single Statement Statement of Financial Performance
- 33. 1. Service -perform services for a fee. 2. Merchandising - selling of finished product by other businesses. 3. Manufacturing - involved in conversion of raw materials into some tangible, physical product. Statement of Comprehensive Income
- 34. Elements of IncomeStatement Income Revenue Expenses - expenses that arise in the course of ordinary regular activities. Gains Includes: - Sales - Fees - Interest Income - Dividends - Royalties - Rent Income Losses Essence: REGULARITY
- 35. Statement of ComprehensiveIncome Functional Presentation Expenses: Distribution cost Administrative cost Other costs Finance cost Natural Presentation Expenses: Increase/ decrease in inventory Net purchases Employee benefit costs Sales commission Advertising Supplies expense Delivery expense Depreciation Taxes and licenses Doubtful accounts Other expenses Natural Functional
- 36. Statement of ComprehensiveIncome [Company Name] Income Statement For the Year Ended Revenue Less: Operating Expenses Earnings before interest and tax Less: Interest expense Less: Tax Expense Net income after tax [Company Name] Income Statement For the Year Ended Sales Less: Cost of goods sold Gross profit Less: Operating expenses Earnings before interest and tax Less: Interest expense Less: Tax Expense Net income after tax Service Business Merchandising and Manufacturing Business
- 37. Statement of ComprehensiveIncome Merchandising business Cost of Goods Sold Beginninginventory Net purchases Goods available for sale Endinginventory Cost of goods sold Cost of Goods Manufactured Beginning raw materials Net purchases Raw materials available for use Less: Ending raw materials Raw materials used Direct labor Factory overhead Total manufacturing cost Beginning goods in process Total cost of goods in process Less: Ending goods in process Cost of goods manufactured Cost of Goods Sold Cost of goods manufactured Beginning finiished goods Goods available for sale Less: Ending finished goods Cost of goods sold Manufacturing Business
- 38. - refers tothe reconciliation of the opening and closing balances of equity in a company during a particular period. Statement of Changes in Equity Sole Proprietorship - single owner operates the business Legal Forms of Business Corporation - artificial being created by law Partnership - owned by two or more individuals with the intention of dividing profits among themselves
- 39. Elements of Changesin Equity Contribution by Owners increase to equity resulting from asset investment Distribution to Owners decrease to equity resulting from distribution of asset
- 40. Statement of Changesin Equity [Company Name] Statement of Changes in Owner's Equity For the Year Ended [Name], Capital, beginning Net income Less: Withdawals [Name], Capital, ending [Company Name] Statement of Changes in Partners' Equity For the Year Ended [Name], Capital [Name], Capital Capital balances, beginning Additional investments Net income Less: Withdrawals Capital balances, ending Sole proprietorship Partnership
- 41. Statement of Changesin Equity [Company Name] Statement of Changes in Shareholders' Equity For the Year Ended Common stock Paid-in capital Retained earnings Treasury Stock Total Beginning balance Issued shares Net income Less: Dividends Ending balance Corporation
- 42. - is aformal statement showing three elements comprising financial position, namely assets, liabilities, and equity. - users analyze the statement of financial position to evaluate such factors as liquidity, solvency, and the need of the entity for additional financing. Statement of Financial Position
- 43. Elements of Statementof Financial Position Asset - present economic resource - controlled by entity as result of past events Liability - present obligation - to transfereconomic resource - obligation is a result of past events Equity - residual interest Accounting Equation A = L + E
- 44. Statement of FinancialPosition Current Assets Cash and cash equivalents Trade and other receivables Marketable securities Prepaid expenses Inventories Noncurrent Assets Propert, plant and equipment Long-term investments Intangible assets Deferred tax assets Other noncurrent assets Current Liabilities Trade and other payables Current provisions Short-term borrowing Current portion of long-term debt Current tax liability Noncurrent Liabilities Noncurrent portion of long-term debt Finance lease liability Deferred tax liability Long-termobligations to company officers Long-term deferred revenue
- 45. Statement of FinancialPosition Sole Proprietorship [Name], Capital Partnership [Name], Capital [Name], Capital Corporation Share Capital Reserves/ Additional Paid-in Capital Accumulated profit/ loss Less: Treasury shares
- 46. Statement of FinancialPosition [Company Name] Statement of Financial Position As of the period Assets = Liabilities + Equity [Company Name] Statement of Financial Position As of the period Assets Liabilities Equity Report Form Account Form
- 47. - is acomponent of financial statements summarizing the operating, investing, and financing activities of an entity. Statement of Cash Flow cash payments cash receipts Cash Flow
- 48. Elements of Statementof Cash Flow Cash flow Operating Activities - nominal accounts - current asset - current liabilities Financing Activities - equity - noncurrent liabilities Investing Activities - noncurrent assets
- 49. Statement of CashFlow [Company name] Statement of Casf Flow Year Ended Cash flow for operating activties Cash from customers Cash from suppliers Cash for opeerating expenses Cash for interest Cash for taxes Net cash provided for operating activities Cash flow for investing activties Cash flow for financing activties Increase (decrease) in cash and cash equivalents Cash and cash equivalents, beginning Cash and cash equivalents, ending [Company name] Statement of Casf Flow Year Ended Cash flow for operating activties Net income Amortization expense (Increase) decrease adjustments in net income Increase (decrease) in current asset and liability Net cash provided for operating activities Cash flow for investing activties Cash flow for financing activties Increase (decrease) in cash and cash equivalents Cash and cash equivalents, beginning Cash and cash equivalents, ending
- 50. - provide narrativedescription or disaggregation of items presented in the financial statements and information about items that do not qualify for recognition. Notes to Financial Statements financial informations non-financial information Presents
- 51. Necessary disclosures: a. Summaryof compliance with PFRS b. Summary of significant accounting policy used c. Supporting information or computation for line items presented in the financial statements. d. Other disclosures Notes to Financial Statements
- 52. Notes to FinancialStatements Note 1. Cash and cash equivalents Cash on hand Cash in bank Treasury bill Total cash and cash equivalents Note 2. Trade and other receivables Accounts receivable Allowance for doubtful accounts Notes receivable Accrued interest on notes receivable Advances to emplyees, collectible currently Total trade and other receivables Note 3. Inventories Finished goods Goods in process Raw materials Manufacturing supplies Total inventories Note 4. Prepaid expenses Office supplies unused Prepaid insurance Total prepaid expenses
- 53. Notes to FinancialStatements Note 5. Property, plant and equipment Land Building Machinery and equipment Furniture and fixtures Total Less: Accumulated depreciation, net Carrying amount Note 6. Long-term investments Plant expansion fund Investment in bonds Cash surrender value Total long-term investments Note 7. Intangible assets Patent Franchise Total intangible assets Note 8. Other noncurrent assets Long-term refundable deposit Long-term advances to officers Total other noncurrent assets
- 54. Notes to FinancialStatements Note 9. Trade and other payables Accounts payable Notes payable Accrued interest on note payable Income tax payable Dividends payable Accrued expenses Total trade and other payables Note 10. Reserves Share premium Retained earnings appropriated for contingencies Total reserves
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- 56. Assignment Study: - Limitations offinancial reporting - Responsibility of financial statements - General feature of financial statements - Identification of financial statement
- 57.