Business Analysis of a Lemonade Stand Essay

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The information illustrated from the journal, to the income statement, to the balance sheet discloses the original expenditures of the Lemonade stand's fixed assets and the accumulated financial loss transcribed over Season One, which includes six days of revenues and expenses, which shows the standard practices of accounting methods appearing on the journal, income statements, and balance sheet attached for the Lemonade stand. The accounting data format sets up a proportion of financial statements at any time the company wants to know how things stand in fiscal matters for the lemonade stand. For just about every company, a financial statement is prepared at some point in time of each calendar month, quarter, and annually reporting …show more content…

Accrual basis accounting affords to provide a more straightforward financial representation than cash basis accounting. A journal is in writing of an idea that prognoses income also known as revenue and expenses, which is the Lemonade stand's spending for a specific period of time. Stated in monetary units and descriptions, the journal is based on the Lemonade stand goals and guarantees practical preparation for sales based on factors like the weather, supplies and the customers. A journal indicates expected revenue, foreseen expenses, and a predicted net income or loss. The journal lists a description of activities on day to day basis showing accounts under the debit columns and amounts on credit columns of expenditures and revenues profits in single file format, which results in the ending balance equaling the amount of debits and credits. This report, also known as a Statement of Operations or a Statement of Receipts and Disbursements, gives a picture of how much money was earned (revenue) by the company and how much money was expenses over a certain time period. A balance sheet is a summary of the financial position of the company at a specific point in time and it includes three parts. Assets are anything of worth that the Lemonade stands possesses. The Lemonade stand may have one or several of each of two types of assets listed in its balance sheet. A current

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