Financial Statements Patty Reagan ACC/561 September 24, 2012 Bethany Kessel Financial Statements The financial statements of a company give the reader a view of the financial health of the company. The four major reports are the income statement, balance sheet, cash flow statement, and the statement of shareholders’ equity. By understanding the statements and how they relate to one another can help any individual to understand the financial position of the company and will aid in making
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M1-6 | | | | | | | | | | | Matching Financial Statement Items to Balance Sheet and Income Statement Categories | | | | | | | Answer | Statement | | | | 1 | Accounts Receivable | | | | | | | 2 | Selling and Administrative Expenses | | | | | | 3 | Cash | | | | | | | | | 4 | Equipment | | | | | | | | 5 | Advertising Expense | | | | | | | 6 | Sales Revene | | | | | | | | 7 | Notes Payable | | | | | | |
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Topic: Cash basis versus Accrual basis of accounting The cash basis of accounting, sometimes called cash accounting, is still used by some small companies whose business activity is uniform throughout the year--receiving and disbursing roughly the same amount of cash each month. Many individuals also use cash accounting.( Edmonds, McNair, Milam, and Olds, Fundamental Financial Accounting Concepts, 4th edition, McGraw-Hill Irwin, 2002) In the cash basis of accounting, the business records are "cash
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are several types of financial statements and there are many uses for these statements that make them particularly useful in business. The many different types show information that is pertinent to the way that each report is used. The four types of statements are; income statements, retained earnings statement, balance sheet, and statement of cash flow. Most of these statements are very important because of the information that they possess. All of these statements are crucial to the ability of
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item consumed the most cash per the Statement of Cash Flows? Looking at the Statement of Cash Flow for both years, we can see that the item that consumed the largest amount is Dividends, €751M and €662M for 2010 and 2009, respectively. 2. Where did the company obtain the cash to pay for the item identified in 1. above? The cash distributed as the Dividends to share holders are obtained from the operations, and are listed as "Cash from Operations". A portion or Cash from Operations is spent
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to analyze a cash flow statement Once you have constructed a cash flow statement, you will be much closer to understanding the financial position of your company. While a balance sheet and income statement are tools for management, without a cash flow statement they are limited barometers and may even be misleading. Operating Activities The cash flow statement will tell you where money came from and how it was used. When analyzing cash flow, the first place to look is the cash flow from operating
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CONCEPTS a. The statement of cash flows details the actual cash generated through a specific time period, usually for fiscal year ending 20XX, for example. The cash flow statement, specifically, identifies the actual cash flowing in and out of the company and reveals how a company spends its money. Conversely, the income statement is based on the accrual method of accounting and will contain revenue, for example, that has not been received or expenses that have not yet been paid. b. The
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2012 Subject: Statement of Cash Flow CC: Learning Team A The Carpino Company is pleased to announce that the organization has experience an exciting first year. This memo and the attached cash flow statement summarize the important details of Carpino’s statement of cash flows for the period ending January 31, 2007. It will provide the shareholders reasons for the difference between net income and net cash used by operating, investing, and financing activities. The cash flow statements will also
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main financial statements. They are: (1) balance sheets; (2) income statements; (3) cash flow statements; and (4) statements of shareholders’ equity. Balance sheets show what a company owns and what it owes at a fixed point in time. Income statements show how much money a company made and spent over a period of time. Cash flow statements show the exchange of money between a company and the outside world also over a period of time. The fourth financial statement, called a “statement of shareholders’
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* Common Stock Transactions * Contributed capital – reports the amount of capital the company received from investors’ contributions, in exchange for the company’s stock. * Retained earnings – reports the cumulative amounts of net income earned by the company less the cumulative amount of dividends declared since the corporation was first organized. * Treasury stock – reports shares that were previously owned by stockholders but have been reacquired and are now held by the
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