Finance

1. Describe a real or made up but realistic situation that could cause you or someone you know to have to use money from a financial reserve. (3-6 sentences. 2.0 points)

There is an general increase of sales when the income statement is provided. “The income statement reports the revenues and expenses for a specific time period.” (Weygandt, J. Kieso, D. Kimmel, P. 2008) The format of an income statement is listed with revenues first then expenses. Net loss is when the expenses exceed the revenue and net income is

The reason is that the company’s expenses exceeded the revenue. Company’s assets have been increasing compared to last year total assets. There hasn’t been a dramtic change in liabilities because the company doesn’t have enough cash to pay its debt.

i. Consider the “Cumulative effect of change in accounting principle” reported on the income statement. Explain in your own words what item represents.

Preparing different income statements captures information in diverse ways to facilitate decision making on internal matters. The management needs to understand cost behavior in order to control the costs. Besides the production costs, changing sales patterns affects profitability and there is a need to achieve better sales accuracy after understanding cost behavior. Variable costing also captures information about the impact of changing operation on profitability and the management is better placed to make pricing decisions to maximize

The accounting equation is, Assets are equal to Liabilities plus Stockholders’ Equity. Assets are resources owned by a business. Liabilities are the debts and obligations of the business. Liabilities represent claims of creditors on the assets of a business. Stockholders’ equity represents the claims of owners on the assets of the business. This equity is divided into two parts: common stock and retained earnings. The balance sheet reports assets and claims to assets at one specific point in time. Claims to assets are subdivided into two categories: claims of creditors and claims of owners. The accounting equation must always balance. Each transaction has a dual effect on the equation. As an example if an individual asset is increased,

6. The accounts effected are warranty liability, sales returns, cost of goods sold, and inventory.

Many people assume that handling personal finances is straightforward and can be done with little to no preparation. This paper delves into the many different aspects of personal finance. It discusses the tools that we are learning in class and explains how these tools that can be used to save for retirement. It offers tips to improve your financial standing both now and in the future. And finally, it compares these tips with advice offered by an expert, Suze Orman. Everyone needs to learn how to properly prepare their finances to reach their goals. While doing so can be easy and rewarding, neglecting

1. This action would affect the year-end income statement by showing an extra $10,000 increase in revenue. It would affect the year-end balance sheet by altering the numbers shown. The amount that is actually owed to the creditors would reflect lower that it really is while the business’ equity and revenue would reflect higher than it truly is.

249 … For example […] repairs may increase the future economic benefits of a piece of equipment. Those kinds of costs may be accounted for as assets either by being added to other assets or by being disclosed

38.The advantage of relating a company 's bad debt expense to its outstanding accounts receivable is that this approach

d. For each item in quotations, provide the year-end total disclosed in Darden’s 2007 income statement. Write a journal entry to record the activity for the year. Assume that the company recorded a single (summary) journal entry.

Proficient: Describe the steps in recording and posting the effects of a business transaction and provide some examples of source documents used in these steps. Define debit and credit and name the types of accounts that are (three correct responses):

(Weighted average cost of capital) The target capital structure for QM Industries is 45% common stock, 6% preferred stock, and 49% debt. If the cost of common equity for the firm is 17.9%, the cost of preferred stock is 10.6%, the before-tax cost of debt is 8.9%, and the firm’s tax rate is 35%, what is QM’s weighted average cost of capital?

Plus: Changes in Other Liabilities | 0 | 0 | 0 | 0 | 0 |