Comparative balance sheet data for the Veronica Co. at the end of 2013 and 2014 follows: Veronica Company Condensed Comparative Balance Sheet December 31, 2014 and 2013 Assets 2014 2013 Current assets ............................... $ 61,000 $ 58,000 Long-term investments ........................ 77,000 53,000 Land, buildings, and equipment (net) ......... 189,000 142,000 Intangible assets ............................ 12,400 21,300 Other assets ................................. 8,000 18,000 Total assets ................................. $347,400 $292,300 Liabilities Current liabilities .......................... $ 37,100 $ 34,000 Long-term liabilities--8% bonds .............. 23,500 17,900 Total liabilities ............................ $ 60,600 $ 51,900 Stockholders' Equity 6% preferred stock ........................... $ 7,500 $ 7,500 Common stock ................................. 50,000 50,000 Additional paid-in capital ................... 46,000 46,000 Retained earnings ............................ 183,300 136,900 Total stockholders' equity ................... $286,800 $240,400 Total liabilities and stockholders' equity ... $347,400 $292,300 Prepare a common-size balance sheet comparing financial structure percentages for the two-year period. Use total assets to standardize. Fill in your answers below: Veronica Company Condensed Common-Size Balance Sheet For Years Ended December 31, 2014 and 2013 Assets 2014 2013 Current assets .............................. _____ _____ Long-term investments ....................... _____ _____ Land, buildings, and equipment (net) ........ _____ _____ Intangible assets ........................... _____ _____ Other assets ................................ _____ _____ Total assets ................................ _____ _____ Liabilities Current liabilities ......................... _____ _____ Long-term liabilities--8% bonds ............. _____ _____ Total liabilities ........................... _____ _____ Stockholders' Equity 6% preferred stock .......................... _____ _____ Common stock ................................ _____ _____ Additional paid-in capital .................. _____ _____ Retained earnings ........................... _____ _____ Total stockholders' equity .................. _____ _____ Total liabilities and stockholders' equity .. _____ _____ not sure exactly what i have to do here!
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.
Comparative
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Veronica Company |
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Condensed Comparative Balance Sheet |
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December 31, 2014 and 2013 |
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Assets |
2014 |
2013 |
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Current assets ............................... |
$ 61,000 |
$ 58,000 |
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Long-term investments ........................ |
77,000 |
53,000 |
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Land, buildings, and equipment (net) ......... |
189,000 |
142,000 |
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Intangible assets ............................ |
12,400 |
21,300 |
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Other assets ................................. |
8,000 |
18,000 |
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Total assets ................................. |
$347,400 |
$292,300 |
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Liabilities |
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Current liabilities .......................... |
$ 37,100 |
$ 34,000 |
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Long-term liabilities--8% bonds .............. |
23,500 |
17,900 |
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Total liabilities ............................ |
$ 60,600 |
$ 51,900 |
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6% |
$ 7,500 |
$ 7,500 |
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Common stock ................................. |
50,000 |
50,000 |
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Additional paid-in capital ................... |
46,000 |
46,000 |
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183,300 |
136,900 |
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Total stockholders' equity ................... |
$286,800 |
$240,400 |
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Total liabilities and stockholders' equity ... |
$347,400 |
$292,300 |
Prepare a common-size balance sheet comparing financial structure percentages for the two-year period. Use total assets to standardize.
Fill in your answers below:
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