BALANCE SHEETS 2015 Assets $ 5,000 Cash 3,800 ST Investments 200 Accounts receivable Inventories INCOME STATEMENTS 2014 2014 2015 $ 4,760 3,560 Net sales 60 50 COGS (excl. depr.) Depreciation Other operating expenses 40 170 380 500 500 500 480 820 1,000 $ 1,550 2,000 $ 3,550 EBIT 550 Total CA $ 1,300 Interest expense Pre-tax earnings Taxes (40%) NI before pref. div. 100 120 Net PP&E 1,700 450 380 Total assets $ 3,000 180 152 228 Liabilities and equity 8 Accounts payable Асcruals 270 Preferred div. 8 190 200 Net income 262 220 280 300 Notes payable Total CL $50 Long-term bonds 130 280 Other Data 600 1,000 $ 1,600 780 Common dividends $48 1,200 Addition to RE $214 $170 Total liabilities $ 1,980 Таx rate 40% 40% Preferred stock 100 100 Shares of common stock 50 50 Common stock 500 500 $5.24 $4.40 Earnings per share Dividends per share Price per share Retained earnings Total common equity Total liabs. & equity 800 970 $ 1,300 $ 3,000 $ 1,470 $ 3,550 $0.96 $1.00 $40.00 $27.00 Compute for the Average Sales Period/Average Age of Inventory, use 360 days Final answers should be in 2 decimal places For example: if your answer is 1.5432 final answer is 1.54 days, if your answer is 1.5632 final answer is 1.57 days %24 %24
Reporting Cash Flows
Reporting of cash flows means a statement of cash flow which is a financial statement. A cash flow statement is prepared by gathering all the data regarding inflows and outflows of a company. The cash flow statement includes cash inflows and outflows from various activities such as operating, financing, and investment. Reporting this statement is important because it is the main financial statement of the company.
Balance Sheet
A balance sheet is an integral part of the set of financial statements of an organization that reports the assets, liabilities, equity (shareholding) capital, other short and long-term debts, along with other related items. A balance sheet is one of the most critical measures of the financial performance and position of the company, and as the name suggests, the statement must balance the assets against the liabilities and equity. The assets are what the company owns, and the liabilities represent what the company owes. Equity represents the amount invested in the business, either by the promoters of the company or by external shareholders. The total assets must match total liabilities plus equity.
Financial Statements
Financial statements are written records of an organization which provide a true and real picture of business activities. It shows the financial position and the operating performance of the company. It is prepared at the end of every financial cycle. It includes three main components that are balance sheet, income statement and cash flow statement.
Owner's Capital
Before we begin to understand what Owner’s capital is and what Equity financing is to an organization, it is important to understand some basic accounting terminologies. A double-entry bookkeeping system Normal account balances are those which are expected to have either a debit balance or a credit balance, depending on the nature of the account. An asset account will have a debit balance as normal balance because an asset is a debit account. Similarly, a liability account will have the normal balance as a credit balance because it is amount owed, representing a credit account. Equity is also said to have a credit balance as its normal balance. However, sometimes the normal balances may be reversed, often due to incorrect journal or posting entries or other accounting/ clerical errors.
![INCOME STATEMENTS
|BALANCE SHEETS
2015 JAssets
$ 5,000
2014
2014
2015
$ 4,760
3,560
Net sales
Cash
60
50
COGS (excl. depr.)
Depreciation
Other operating expenses
3,800
ST Investments
40
170
200
Accounts receivable
380
500
500
500
480
Inventories
820
1,000
$ 1,550
2,000
$ 3,550
ЕBIT
550
Total CA
$ 1,300
Interest expense
Pre-tax earnings
100
120
Net PP&E
1,700
450
380
Total assets
$ 3,000
152
228 Liabilities and equity
8 Accounts payable
220 | Accruals
Notes payable
Total CL
Taxes (40%)
NI before pref. div.
180
270
Preferred div.
8
$
190
200
Net income
262
280
300
130
280
Other Data
600
780
Common dividends
$50
1,000
$ 1,600
$48
Long-term bonds
Total liabilities
1,200
Addition to RE
$214
$170
$ 1,980
Tax rate
40%
40%
Preferred stock
100
100
Shares of common stock
50
50
Common stock
500
500
$5.24
$4.40
Earnings per share
Dividends per share
Price per share
Retained earnings
Total common equity
Total liabs. & equity
800
$ 1,300
$ 3,000
970
$ 1,470
$ 3,550
$0.96
$1.00
$40.00
$27.00
Compute for the Average Sales Period/Average Age of Inventory, use 360 days
Final answers should be in 2 decimal places
For example: if your answer is 1.5432 final answer is 1.54 days, if your answer is 1.5632 final answer is
1.57 days
%24
%24
%24
%24
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