Chapter 1, Problem 4C

1.

To determine

List four basic financial statements.

2.

To determine

Compute the amount for accounting equation to prove that it works for CVS.

3.

To determine

Compute total revenue of CVS for the year ended December 31, 2010.

4.

To determine

Identify whether CVS is profitable in the year ended December 31, 2011. Compute net income and find whether it increase or decrease for the year ended December 31, 2010.

5.

To determine

Identify whether company’s cash and cash equivalents increased from December 31, 2010 to

December 31, 2011, in case of yes indicate the amount. List the two places in the statements that the number is found and evaluated.

6.

To determine

Indicate whether cash flow from all three activities increase or decrease from the year 2010 to 2011.

7.

To determine

Identify the auditor of the company and give reason for the importance of the auditor’s report that is accompanied by the financial statement.