Financial Statements: financial accounting is the branch of accounting concerned with communicating financial information to outsiders through financial statements.
Financial statements: It consists of four major statements:
- Balance sheet summarizes assets, liabilities and owners’ equity of a company, used to assess financial position of a company.
- An income statement summarizes the revenue and expenses of a company for a period and used to calculate profit or loss.
- Statement of retained earning shows the portion of earnings retained in the business and
- Statement of cash flows shows how the cash company got cash and where it is used during a period.
To prepare: The correct income statement for December 31 2016.
b.
Financial Statements: financial accounting is the branch of accounting concerned with communicating financial information to outsiders through financial statements.
Financial statements: It consists of four major statements: balance sheet, income statement, statement of retained earnings, and statement of cash flows.
- Balance sheet summarizes assets, liabilities and owners’ equity of a company, used to assess financial position of a company.
- An income statement summarizes the revenue and expenses of a company for a period and used to calculate profit or loss.
- Statement of retained earning shows the portion of earnings retained in the business and
- Statement of cash flows shows how the cash company got cash and where it is used during a period.
To prepare: The correct retained earnings.
c
Financial Statements: financial accounting is the branch of accounting concerned with communicating financial information to outsiders through financial statements.
Financial statements: It consists of four major statements: balance sheet, income statement, statement of retained earnings, and statement of cash flows.
- Balance sheet summarizes assets, liabilities and owners’ equity of a company, used to assess financial position of a company.
- An income statement summarizes the revenue and expenses of a company for a period and used to calculate profit or loss.
- Statement of retained earning shows the portion of earnings retained in the business and
- Statement of cash flows shows how the cash company got cash and where it is used during a period.
To prepare: The balance sheet for the year ended December 31 2016
d.
Financial Statements: financial accounting is the branch of accounting concerned with communicating financial information to outsiders through financial statements.
Financial statements: It consists of four major statements: balance sheet, income statement, statement of retained earnings, and statement of cash flows.
- Balance sheet summarizes assets, liabilities and owners’ equity of a company, used to assess financial position of a company.
- An income statement summarizes the revenue and expenses of a company for a period and used to calculate profit or loss.
- Statement of retained earning shows the portion of earnings retained in the business and
- Statement of cash flows shows how the cash company got cash and where it is used during a period.
To draft: A memo to president explaining difference between the income statements provided and corrected statement.
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Financial Accounting: The Impact on Decision Makers
- Nancy Thomas is the chief accountant at Company C, a manufacturer of medical equipment. The company is under pressure from creditors to increase its earnings. Shortly after the end of the fiscal year, the company performed a physical count of the inventory. A significant amount of inventory shrinkage was discovered. The amount is so large that it will result in a significant drop in earnings this period. The decrease in earnings will hurt the company's chance at getting a much needed loan at a low interest rate. Nancy is thinking of not reporting the shrinkage until next period, after the company gets its loan. What should Nancy do in this situation? Why?arrow_forwardCalifornia Cannery began in 2008 with a debit balance in Accounts Receivable $150,000 and a credit balance in Allowance for Doubtful Accounts for 7,500 for the year. During the year California Cannery sold 1,300,000 of product and collected 1,350,000 from customers. In addition, $4,000 of Accounts Receivable balance was written off as uncollectable during the year. Management uses the allowance method to account for bad debts and believes that ultimately 5% of the year-end balance in Accounts Receivable will not be collected. How much bad debt expenses will be recorded in 2008?arrow_forwardNote:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.arrow_forward
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