ADMS 1500 Chapter Notes - Chapter 2: Accrual, Historical Cost, Cash Flow Statement

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chocolateguinea-pig439

7 Sep 2016

School

York University

Department

Administrative Studies

Course

ADMS 1500

Professor

K Paul Evans

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Document Summary

Chapter 2: the financial statement: financial reports/ the objectives of financial reporting. The financial statement must be distributed annually to shareholders. The financial statement shall consist of an income statement, a balance sheet, a statement of retained earnings and a statement of cash flows. The statement should be prepared in accordance to the standards of the cpa. Are prepared fir the use of actual and potential investors and creditors. Should assist users to predict future cash flows. Are the use of those who make investing and lending decisions. Provide some evidence of the extent to which directors have exercised good management: the accounting equation. The balance sheet is essentially a detailed listing of. The owners financial interest claim on the company. Assets: the sum of the value of everything the company owns. Owners equity: the total value of the owner"s financial claim on the company. Liability: the sum of all the debt claims on the company: the balance sheet.

Related Questions

7. Consider theeffects of the independent transactions, a through i, on acompanyâs balance sheet, income statement, statement of cash flows,and statement of stockholdersâ equity.

a. The company purchasedinventory on credit.

b. The company sold allinventory purchased in transaction a) on credit (and formore than its cost).

c. The company collectedcash from customers from transaction b).

d. The company purchasedequipment with cash.

e. The company paid cash fora note payable that came due.

f. The company paidcash for interest on borrowings.

g. Wages were earned bycompany employees but not yet paid.

h. The company paid cash individends.

i. The companyreceived cash for the issuance of stock.

Complete the table below to explainthe effects and financial statement linkages. Use â+â to indicatethe account increases and âââ to indicate the account decreases (15pts).

Balance sheet

Cash

Noncash assets

Total liabilities

Contributed capital

Retained earnings

Statement of cash flows

Operating cash flow

Investing cash flow

Financing cash flow

Income statement

Revenues

Expenses

Net earnings

Statement of stockholdersâ equity

Contributed capital

Retained earnings

skydog210

MG770- Financial Reporting, Financial Statement Analysis, andValuation
Homework Assignment
Week # 3
__________________________________________________________________________

Create the statement of cash-flow with indirectmethod

Interpret the result of the statement of cash flow withpercentage

Instruction:

[1] Please use the balance sheet as follows to classify eachactivity (operating, investing, and financing) from the column ofdifferent.

[2] please create a new statement of cash-flow from yourclassification on balance sheet.

[3] The statement of cash flow will be provided to measure thecompanyâs cash flow situation. Also, you need to interpret theresult of your measurement.

Balance sheet

SILVERT CORPORATION
Balance Sheet
December 31
			Different	Operating	Investing	Financing
	2012	2011
ASSET
Cash	$ 28,000	$20,000	$8,000
Receivable (net)	70,000	62,000	$8,000
Other current assets	90,000	73,000	$17,000
Long-term investment	62,000	60,000	$2,000
Plant and equipment (net)	510,000	470,000	$40,000
Total Assets	$760,000	$685,000	$75,000

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities	$75,000	$70,000	$5,000
Long-term debt	80,000	90,000	($10,000)
Common stock	330,000	300,000	$30,000
Retained earnings	275,000	225,000	$50,000
Total liabilities and stockholdersâ equity	760,000	685,000	$75,000

]2] Create the statement of cash-flow by using the indirectmethod. Company has net income as starting point of $80,000.

STATEMENT OF CASH FLOW

*Operating Activities*
Net Income	$ 80,000





Cashflow from Operations

*Investing Activities*



Cashflow from Investing

*Financing Activities*



Cashflow from Financing