Chapter-9-Financial-Statements.ppt

Click to edit Master title style,Click to edit Master text styles,Second Level,Third Level,10-,*,FINANCIAL STATEMENTS,CHAPTER 9,Work sheet,For large companies,if the financial statements are,prepared directly from the adjusted trial balance,errors are very difficult to occur.As a result,a work,sheet,is essential.,Stevs Barber Shop,Work Sheet,March 31,20XX,Account name,Trial Balance,Adjustments,Adjusted Trial Balance,Income Statement,Balance Sheet,Debit,Credit,Debit,Credit,Debit,Credit,Debit,Credit,Debit,Credit,Cash,Accounts Receivable,Haircutting Supplies,Office Supplies,Prepaid Rent,Prepaid Insurance,Haircutting Equipment,Accumulated Depreciation,Haircutting Equipment,Store Equipment,$,3,3,90,9,00,400,2,00,4,800,600,800,2,400,$,1,00,50,400,50,1,3,.,3,$,3,3,90,9,00,300,1,50,4,400,550,8,00,2,400,$,1,3,.,3,$,3,3,90,9,00,300,1,50,4,400,550,8,00,2,400,$,1,3,.,3,Stevs Barber Shop,Work Sheet,March 31,20XX,Account name,Trial Balance,Adjustments,Adjusted Trial Balance,Income Statement,Balance Sheet,Debit,Credit,Debit,Credit,Debit,Credit,Debit,Credit,Debit,Credit,Accumulated Depreciation,Store Equipment,Accounts Payable,Unearned Haircutting Fees,Stev Taylor,Capital,Stev Taylor,Withdrawals,Haircutting Service Revenue,Wages Expense,Utility Expense,Telephone Expense,4,80,400,230,120,14,720,$,1,120,1,300,1,0,000,2,300,14,720,$500,40,4,80,400,230,120,40,1,120,800,1,0,000,2,300,400,230,120,2,300,4,80,40,1,120,800,1,0,000,Stevs Barber Shop,Work Sheet,March 31,20XX,Account name,Trial Balance,Adjustments,Adjusted Trial Balance,Income Statement,Balance Sheet,Debit,Credit,Debit,Credit,Debit,Credit,Debit,Credit,Debit,Credit,Rent Expense,Insurance Expense,Haicutting Supplies Expense,Office Supplies Expense,Depreciation Expense,Haircutting Equipment,Depreciation Expense,Store Equipment,Net Income,400,50,1,00,5,0,1,3,.,3,40,1,153.3,1,513.3,400,50,1,00,5,0,1,3,.,3,40,14,773.3,14,773.3,400,50,1,00,5,0,1,3,.,3,40,1,403.3,2,800,1396.7,13,370,1396.7,11,973.3,Financial Statement,Private individuals,Non-profit organizations,Retailers,Wholesalers,Service industries,Financial,Statement,Draw up,Financial statements are used by,management,investors,creditors,and,government regulatory agencies,.,It can be used as a guide for your business activities.,Income Statement,Income Statement,is known also as,the profit and loss statement.,Income Statement shows all income and expense accounts over a period of time.,Income statements are used to,track revenues and expenses,so that you can determine the,operating performance of the,business over a period of time,such as a month,three months,or one year.,Stevs Barber Shop,Income Statement,March 31,20XX,Debit,Credit,Revenues,Haircutting Services Revenue,$,2,800,Total Revenues,2,800,Expenses,Wages Expense,$,400,Utility Expense,230,Telephone Expense,120,Rent Expense,400,Insurance Expense,50,Haircutting Supplies Expense,1,00,Office Supplies Expense,5,0,Depreciation Expense,Haircutting Equipment,1,3,.,3,Depreciation Expense,Store Equipment,40,Total Expense,1,403.3,Net Income,$,1,396.7,Statement of Owners Equity,The statement of the owners equity tells the readers,the total capital the company owns for a period of time.,It also shows the investment,the owner has made and,how much the owner has,withdrawn from the,companys account.,Stevs Barber Shop,Statement of Owners Equity,March 31,20XX,Items,Debit,Credit,Steve Taylor,Capital,March 1,20XX,Add:Investment by Steve Taylor,$10,000,Net Income,1,396.7,Subtotal,11,396.7,Less:Withdrawals,$480,Stev Taylor,Capital,March31,20XX,10,916.7,Balance Sheet,A balance sheet is a statement of the financial condition,at a given point in time.,It shows the companys financial position:,what it owns and what it owes.,Balance Sheet,Important uses of balance sheet:,The balance sheet indicates the businesss net worth.,The balance sheet shows how the business is being funded,and how those funds are being used.,2),The balance sheet can help determine if too much or too,little capital is tied up in permanent investments by,comparing total current assets to total non-current assets.,3),The balance sheet gives information on how best to meet liabilities.,Stevs Barber Shop,Balance Sheet,March 31,20XX,Accounts,Debit,Credit,Assets,Cash,$,3,390,Accounts Receivable,900,Haircutting Supplies,300,Office Supplies,150,Prepaid Rent,4,400,Prepaid Insurance,550,Haircutting Equipment,800,Less:Accumulated Depreciation,Haircutting Equipment,$,1,3,.,3,786.7,Store Equipment,2,400,Less:Accumulated Depreciation,Store Equipment,40,2,360,Total Assets,12,836.7,Accounts,Debit,Credit,Liabilities,Accounts Payable,$,1,120,Unearned Haircutting Fees,800,Total Liabilities,1,920,Owners Equity,Stev Taylor,Capital,11,396.7,Stev Taylor,Withdrawals,4,80,Total Liabilities and Owners Equity,12,836.7,Stevs Barber Shop,Balance Sheet,March 31,20XX,WE ARE SAILING RIGHT ALONG!,