Introduction to Financial Statements

Slides:

Advertisements

Similar presentations

C1 - 1 Learning Objectives 1.Nature of a Business 2.The Role of Accounting in Business 3.Business Ethics 4.Profession of Accounting 5.Generally Accepted.

Advertisements

C1 - 1 Learning Objectives 1.Nature of a Business 2.The Role of Accounting in Business 3.Business Ethics 4.Profession of Accounting 5.Generally Accepted.

Financial Accounting Review McGraw-Hill/Irwin © 2009 The McGraw-Hill Companies, Inc.

© 2004 The McGraw-Hill Companies McGraw-Hill/Irwin Name of entity 2. Title of statement 3. Specific date 4. Unit of measure The Balance Sheet reports.

What do we hope to learn? What are the characteristics of a corporation? What are the four basic financial statements? What information does each statement.

BUS 2101 Decision Making Financial Information Financial Statement Analysis Financial Statements GAAP Income Statement Statement of Cash Flow Balance Sheet.

Using Accounting Information Business Planning Activities n Individual Point of View n Business Point of View –Planning –Budgeting.

1 Financial Accounting: Tools for Business Decision Making, 4th Ed. Kimmel, Weygandt, Kieso CHAPTER 1 Prepared by Dr. Joseph Otto CSLA.

McClaren Corporation Income Statement For the Year Ended June 30, 2008 Revenue Sale Revenue $100,000 Sale Revenue $100,000 Total Sales Revenue 100,000.

Uses of Accounting Information and the Financial Statements

Financial Accounting, Sixth Edition

2-1 CHAPTER 7 Financial Statements and CF Balance sheet Income statement Statement of cash flows Free Cash Flow Performance Analysis.

Financial Accounting: Tools for Business Decision Making

Financial Accounting Accounting is--- Accounting is--- –A system by which assumed responsibility is validated Accounting may validate— Accounting may validate—

GAAP PowerPoint #4.  A formal record of the financial activities of a business  Includes four basic financial statements: ◦ Balance Sheet (Statement.

Financial Statements and Business Decisions Chapter 1 McGraw-Hill/Irwin © 2009 The McGraw-Hill Companies, Inc.

Financial Statements and Cash Flow  Key Financial Statements  Balance Sheet  Income Statement  Statement of Stockholders’ Equity  Statement of Cash.

Accounting and Financial Reporting Entrepreneurship & Small Business Management.

Dr Irena JindrichovskaCorporate finance A11 Corporate Finance A1 Vysoká škola finanční a správní Summer Semester 2013 Irena Jindřichovská

Copyright 2003 Prentice Hall Publishing1 Simple Model of a Business “The Firm” INPUTS Value added conversion OUTPUTS Capital (financing) Property, Plant,

Financial Statements and Business Decisions Chapter 1 McGraw-Hill/Irwin © 2009 The McGraw-Hill Companies, Inc.

Copyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin.

CHAPTER 1 BUSINESS DECISIONS BUSINESS DECISIONS And FINANCIAL ACCOUNTING..

AC113 Accounting for Non-Accounting Majors Seminar: Unit 2

Primary Objective of Financial Reporting Invest?? Borrow $$?? Sell stocks or bonds?? Start new business?? Loan $$?? Extend credit $$?? LO1 Provide information.

Chart of Accounts.

Describe various organizational forms and business decision makers. 1-1.

Spiceland | Thomas | Herrmann Financial Accounting Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without.

Introduction to Accounting. Definition of Accounting Accounting is a language of business. As the American Accounting Association: “ accounting is the.

Chapter 1 Accounting in Action. What is Accounting?  An information system that identifies, records and communicates economic events Identify: select.

Introduction to Accounting Trang. Definition of Accounting Accounting is a language of business. As the American Accounting Association: “ accounting.

Primary Objective of Financial Reporting Invest?? Borrow $$?? Sell stocks or bonds?? Start new business?? Loan $$?? Extend credit $$?? LO1 Provide information.

© McGraw-Hill Ryerson. All rights reserved.

Chapter 1-1 Introduction to Financial Statements Financial Accounting, Fifth Edition.

Introduction to Accounting and Business

2 Introduction to Using Financial Accounting Information, 7/e

Introduction to Accounting Preparing for a User’s Perspective

The Financial Statements

The Role of Accounting in Business

CHAPTER1 Accounting in Action.

1.01 Generally Accepted Accounting Principles – Financial Statements

BASIC FINANCIAL STATEMENTS

Building Financial Statements

Hospitality Accounting in Action

(Financial Statements) Accounting Principles, Eighth Edition

ACCOUNTING ASW SUMMER 2007 Mark Lang.

Introduction to Accounting Preparing for a User’s Perspective

Financial Accounting: Tools for Business Decision Making

© 2015 Cengage Learning. All Rights Reserved.

PEMBELIAN Balance Sheet

INVENTORY (Pengelolaan Persediaan)

Building Financial Statements

1.01 Generally Accepted Accounting Principles – Financial Statements

BANKING (Penerimaan dan Pengeluaran Kas)

INVENTORY (Pengelolaan Persediaan)

BUSINESS HIGH SCHOOL-ACCOUNTING I

FINANCIAL ACCOUNTING Robert Libby Patricia A. Libby Daniel G. Short.

BANKING (Penerimaan dan Pengeluaran Kas)

Introduction to Financial Statements

Financial Accounting, Sixth Edition

ACCOUNTING CHAPTER 2 REVIEW

Statement of Cash Flows

Point 6 Financial Statements

(Financial Statements) Accounting Principles, Eighth Edition

Chapter 4 Statement of Cash Flows

Introduction to Accounting and Business

Flow of Accounts into Financial Statements

Simpson Company experienced the following events during Year 1.

Building Financial Statements

Presentation transcript:

Introduction to Financial Statements Chapter 1 Introduction to Financial Statements

A Word About My PP My PP is designed to simplify the chapter in just a few slides WileyPlus has excellent PP and other supplemental resources—please take a look and use these resources—they are free

Users of Accounting Information External Users Primarily investors and creditors But also, government agencies, labor unions and others Internal Users Users within the business, such as managers

Accounting Equation Assets=Liabilities + Stockholders’ Equity Assets are economic resources Liabilities are creditor’s claims to assets Stockholders’ equity represents stockholders’ claims to assets

Two Types of SE Accounts Contributed capital—owners’ investments Retained earnings—earnings generated by the business

4 Financial Statements Income statement. Revenues-expenses=net income. Over a period of time. Retained earnings statement. BRE + NI – Dividend=ERE. Remember dividends are not an expense used to generate revenue so don’t belong. on income statement. Over a period of time. Balance sheet. Assets = Liabilities + Stockholders’ Equity. At a point in time. Statement of Cash Flows. Cash flows from operating, investing and financing activities. Over a period of time

Income Statement

Retained Earnings Statement

Balance Sheet

Statement of Cash Flows

Statement of Cash Flows

Interrelationships of Statements Net income on IS; goes to SRE, and is added to beginning retained earnings Ending retained earnings on the SRE will also appear on the balance sheet as a component of Stockholders’ Equity On comparative balance sheets, the difference between the cash balances is explained by the statement of cash flows

Annual Report Contains audited financial statements, notes to the financial statements. Notes are important, contain description of significant accounting policies, and also more detail Also contains management discussion and analysis

FINANCIAL STATEMENTS Review Question Which of the following financial statements is prepared as of a specific date? Balance sheet. Income statement. Retained earnings statement. Statement of cash flows. LO 3

FINANCIAL STATEMENTS Review Question Net income will result during a time period when: assets exceed liabilities. assets exceed revenues. expenses exceed revenues. revenues exceed expenses. LO 3