Semino Beverage has the following historical financial statements: Balance Sheet Cash Sales Oper. Expenses Total assets Depreciation EBIT Interest Expense EBT Taxes Net Income 2021 $200 Accounts receivable $405 2022 $622 __671.76 2021 2022 $1500 $1620 1990 $1000 $156 $344 $64 $280 $70 $210 180 64 Accounts payable Notes payable (plug) Accruals Current liabilities Inventory. Total current assets $1227 Gross plant & equip. $1740 Accum. Depreciation $1000 Net plant & equip. $740 Retained earnings $1,967 Total liab. & equity $1,967 Next year Semino's sales are forecast to change from $1500 to $1620. Operating expenses are a constant percent of sales. Depreciation is as listed for next year. Interest expense varies directly with Long-term bonds. Notes payable, is your "plug" account, and are discount bonds and accrue no interest. The firm's tax rate will be unchanged next year. Several Balance Sheet items are assumed to vary directly with. sales; Cash, Accounts Receivable, Inventory, Accounts payable, and Accruals. The firm plans to purchase/increase Gross Plant and Equipment assets by $250. The firm has no plans to issue debt or equity. The firm pays out 50% of net income as dividends. It is OK if the Notes Payable is negative on your pro forma statement. Based on these facts, fill in the blanks of the missing numbers. Long-term bonds 2021 Common stock $240 $53 $308 $601 $800 $285 2022 $281 259.20 800 of Cash? new level of Accum. Depreciation the nearest $, what is the new level of Retained Earnings? A/ 285 Use the provided image to answer the following questions. To the nearest $, what is 2022 level of Oper. Expenses? A To the nearest $, what is the new level of Net Income? A To the nearest $, what is the new level A/ To the nearest $, what is the A To
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.
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