March 3 issued 150,000 additional ordinary shares for 18 per share declared a dividend of 1.50 per share to be paid on july 31 2013, to shareholders' record on june 30 2013 approved additional building renovation to be funded internally. The estimated May 18 June 19 cost of the project is 600,000, and retained eamings are to be restricted for that amount July Nov 31 paid dividend declared property dividend to be paid on jan 5 2014. The dividend is to consist 12 of equipment that has a carrying amount of 360,000 and fair value of 472,500 on
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.
What is the total equity?
![The shareholders equity section of Bahrain corporation's statement of financial position as of dec 31
2012 is as follows
Share capital – ordinary (10 par, 750.000
shares authorized, 412,500 issued and outstanding
share premium
total paid in capital
unappropriated retained eamings
Appropriated retained earnings
Total retained earnings
Total shareholders' equity
4,125,000
825,000
4,950,000
2,002,500
750,000
2,752,500
7.702.500
Bahrain Corporation had the following shareholders' equity transaction during 2013
Jan
15
completed the building renovation for which 750,000 of retained eamings had
been restricted. Paid the contractor 727,500, all of which is capitalized
March
3
issued 150,000 additional ordinary shares for 18 per share
declared a dividend of 1.50 per share to be paid on july 31 2013, to
shareholders' record on june 30 2013
approved additional building renovation to be funded internally. The estimated
May
18
June
19
cost of the project is 600,000, and retained eamings are to be restricted for that
amount
July
31
paid dividend
declared property dividend to be paid on jan 5 2014. The dividend is to consist
Nov
12
of equipment that has a carrying amount of 360,000 and fair value of 472,500
on
nov. 12
Dec
31
net income for 2013 (before recognition of impairment loss on the equipment
declared as properlt dividend) is 1,327,500. The equipments fair value less cost
to
distribute on dec 31 is 330,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F03a60584-9401-405b-9c84-2c72c0a1891b%2Fc3d8ab3d-9556-4eda-8c3a-81a433396114%2Fc01y8ze_processed.png&w=3840&q=75)
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