Skip to main content

Business Accounting EP HORNGREN'S FINAN.+MGRL.ACCT.-ACCESS

(1) To compute : Expenses of the company. Introduction: The financial statements of a company include the balance sheet , income statement, and cash flow statement. All these statements help the internal and external users of financial statements help in analyzing and concluding the financial position of the respective company. Accounting equation has been stated below: Total assets = Total liabilities + Total shareholders’ equity Now, rearranging the equation, equity can be computed as: Total shareholders’ equity = Total assets − Total liabilities Substituting the values, Total shareholders’ equity = $45,800 - $17,220 Total shareholders’ equity = $28,580 Shareholders’ equity can further be written as, Total shareholders’ equity = Common Stock + Revenue − Expenses − Dividend Now, rearranging the equation, expenses can be computed as: Expenses = Common Stock + Revenue − Dividend - Total shareholders’ equity Substituting the values, Expenses = $27,460 + 8,850 − 6,500 - $28,580 Expenses = $14,230 (2) To interpret : If the company is in profit. Introduction: The financial statements of a company include the balance sheet, income statement, and cash flow statement. All these statements help the internal and external users of financial statements help in analyzing and concluding the financial position of the respective company. The profitability of a firm can be computed as: Profit = Revenue − Expenses Substituting the values, Profit = $8,850 - $14,230 Profit = -$5,380 Since the amount is negative, thus, the company was in a loss for the respective period.

(1) To compute : Expenses of the company. Introduction: The financial statements of a company include the balance sheet , income statement, and cash flow statement. All these statements help the internal and external users of financial statements help in analyzing and concluding the financial position of the respective company. Accounting equation has been stated below: Total assets = Total liabilities + Total shareholders’ equity Now, rearranging the equation, equity can be computed as: Total shareholders’ equity = Total assets − Total liabilities Substituting the values, Total shareholders’ equity = $45,800 - $17,220 Total shareholders’ equity = $28,580 Shareholders’ equity can further be written as, Total shareholders’ equity = Common Stock + Revenue − Expenses − Dividend Now, rearranging the equation, expenses can be computed as: Expenses = Common Stock + Revenue − Dividend - Total shareholders’ equity Substituting the values, Expenses = $27,460 + 8,850 − 6,500 - $28,580 Expenses = $14,230 (2) To interpret : If the company is in profit. Introduction: The financial statements of a company include the balance sheet, income statement, and cash flow statement. All these statements help the internal and external users of financial statements help in analyzing and concluding the financial position of the respective company. The profitability of a firm can be computed as: Profit = Revenue − Expenses Substituting the values, Profit = $8,850 - $14,230 Profit = -$5,380 Since the amount is negative, thus, the company was in a loss for the respective period.

Solution Summary: The author explains that the financial statements of a company include the balance sheet, income statement, and cash flow statement.

EP HORNGREN'S FINAN.+MGRL.ACCT.-ACCESS

EP HORNGREN'S FINAN.+MGRL.ACCT.-ACCESS

7th Edition

ISBN: 9780136516309

Author: MILLER-NOBLES

Publisher: PEARSON CO

See similar textbooks

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

Blurred answer

Chapter 1, Problem 1.6SE

Chapter 1, Problem 1.8SE

Students have asked these similar questions

General accounting question

What was the amount of credit sales during August

What is the target stock price in one year

Chapter 1 Solutions

EP HORNGREN'S FINAN.+MGRL.ACCT.-ACCESS

Ch. 1 - Prob. 1QC Ch. 1 - Prob. 2QC Ch. 1 - Prob. 3QC Ch. 1 - Prob. 4QC Ch. 1 - Prob. 5QC Ch. 1 - Which of the following requires accounting...Ch. 1 - At the end of a recent year, Global Cleaning...Ch. 1 - Consider the overall effects on Global Cleaning...Ch. 1 - Assume that Global Cleaning Service performed...Ch. 1 - The balance sheet reports the a. financial...

Ch. 1 - Assume Global Cleaning Service had net income of...Ch. 1 - What is accounting?Ch. 1 - Prob. 2RQ Ch. 1 - Prob. 3RQ Ch. 1 - Prob. 4RQ Ch. 1 - Prob. 5RQ Ch. 1 - Prob. 6RQ Ch. 1 - Prob. 7RQ Ch. 1 - Prob. 8RQ Ch. 1 - Prob. 9RQ Ch. 1 - Which concept states that accounting information...Ch. 1 - Financial statements in the United States are...Ch. 1 - Prob. 12RQ Ch. 1 - Prob. 13RQ Ch. 1 - Prob. 14RQ Ch. 1 - Prob. 15RQ Ch. 1 - Prob. 16RQ Ch. 1 - List the four financial statements. Briefly...Ch. 1 - What is the calculation for return on assets...Ch. 1 - Identifying users of accounting information For...Ch. 1 - Prob. 1.2SE Ch. 1 - Prob. 1.3SE Ch. 1 - Prob. 1.4SE Ch. 1 - Applying accounting assumptions and principles...Ch. 1 - Prob. 1.6SE Ch. 1 - Prob. 1.7SE Ch. 1 - Identifying accounts Consider the following...Ch. 1 - Using the accounting equation to analyze...Ch. 1 - Using the accounting equation to analyze...Ch. 1 - Prob. 1.11SE Ch. 1 - Prob. 1.12SE Ch. 1 - Prob. 1.13SE Ch. 1 - Prob. 1.14SE Ch. 1 - Prob. 1.15SE Ch. 1 - Prob. 1.16SE Ch. 1 - Prob. 1.17E Ch. 1 - Prob. 1.18E Ch. 1 - Prob. 1.19E Ch. 1 - Prob. 1.20E Ch. 1 - Prob. 1.21E Ch. 1 - Prob. 1.22E Ch. 1 - Prob. 1.23E Ch. 1 - Prob. 1.24E Ch. 1 - Using the accounting equation to analyze...Ch. 1 - Using the accounting equation to analyze business...Ch. 1 - Using the accounting equation to analyze business...Ch. 1 - Prob. 1.28E Ch. 1 - Prob. 1.29E Ch. 1 - Prob. 1.30E Ch. 1 - Use the following information to answer Exercises...Ch. 1 - Use the following information to answer Exercises...Ch. 1 - Prob. 1.33E Ch. 1 - Use the following information to answer Exercises...Ch. 1 - Use the following information to answer Exercises...Ch. 1 - Use the following information to answer Exercises...Ch. 1 - Preparing the statement of cash flows For each...Ch. 1 - Prob. 1.38E Ch. 1 - Prob. 1.39E Ch. 1 - Prob. 1.40E Ch. 1 - Prob. 1.41AP Ch. 1 - Prob. 1.42AP Ch. 1 - Prob. 1.43AP Ch. 1 - Prob. 1.44AP Ch. 1 - Prob. 1.45AP Ch. 1 - Prob. 1.46AP Ch. 1 - Prob. 1.47AP Ch. 1 - Prob. 1.48BP Ch. 1 - Prob. 1.49BP Ch. 1 - Prob. 1.50BP Ch. 1 - Prob. 1.51BP Ch. 1 - Prob. 1.52BP Ch. 1 - Prob. 1.53BP Ch. 1 - Prob. 1.54BP Ch. 1 - Prob. 1.55CP Ch. 1 - Lets examine a case using Gregs Tunes and Sals...Ch. 1 - The tobacco companies have paid billions because...Ch. 1 - Prob. 1.1CTFC

Knowledge Booster

Background pattern image

Similar questions

SEE MORE QUESTIONS

Recommended textbooks for you

Principles of Accounting Volume 1
Accounting
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax College
Financial Accounting: The Impact on Decision Make...
Accounting
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Cengage Learning
Financial Accounting Intro Concepts Meth/Uses
Finance
ISBN:9781285595047
Author:Weil
Publisher:Cengage

Text book image

Principles of Accounting Volume 1

Accounting

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax College

Text book image

Financial Accounting: The Impact on Decision Make...

Accounting

ISBN:9781305654174

Author:Gary A. Porter, Curtis L. Norton

Publisher:Cengage Learning

Text book image

Financial Accounting Intro Concepts Meth/Uses

Finance

ISBN:9781285595047

Author:Weil

Publisher:Cengage

SEE MORE TEXTBOOKS