Chap003s - Working With Financial Statements Chapter Three...

Working With Financial
Statements
Chapter
Three

Sample Balance Sheet – Assets -
$000s
2006 2005 Difference
Cash $3,171 $6,489 -$3,318
A/R 1,095,118 1,048,991 46,127
Inventory 388,947 295,255 93,692
Other CA 314,454 232,304 82,150
Total CA $1,801,690 $1,583,039 $218,651
Net FA $3,129,754 $2,535,072 $594,682
Total Assets $4,931,444 $4,118,111 $813,333

Sample Balance Sheet – L+OE -
$000s
2006 2005 Difference
A/P $313,286 $340,220 -$26,934
N/P 227,848 86,631 141,217
Other CL 1,239,651 1,098,602 141,049
Total CL $1,780,785 $1,525,453 $255,332
LTD $1,389,615 $944,168 $445,447
C/S and PI Surplus $1,761,044 $1,648,490 $112,554
Total L+OE $4,931,444 $4,118,111 $813,333

Sample Income Statement - $000s
Revenues $4,335,491
COGS 1,762,721
Expenses 1,390,262
Depreciation 362,325
EBIT $820,183
Interest Expense 52,841
Taxable Income $767,342
Taxes 295,426
Net Income $471,916
Dividends Paid $395,521
Addition to RE $76,395

Sources and Uses
•
Sources
–
Cash inflow – occurs when we “sell” something
–
Decrease in asset account ( Sample B/S )
•
In this example, Cash & equivalents is the only source
–
Increase in liability or equity account
•
In this example, everything except accounts payable is a
source
•
Uses
–
Cash outflow – occurs when we “buy” something
–
Increase in asset account
•
In this example, everything except cash & equivalents is a
use
–
Decrease in liability or equity account
•
In this example, Accounts payable is the only use

Sample Sources and Uses Statement
($000s)
Sources of Cash:
Increase in N/P $141,217
Increase in Other CL 141,049
Increase in LT Debt 445,447
Increase in C/S 112,554
Total Sources $840,267
Uses of Cash:
Increase in A/R $46,127
Increase in Inventory 93,692
Increase in Other CA 82,150
Increase in Net FA 594,682
Decrease in A/P 26,934
Total Uses $843,585
Net Addition to Cash -$3,318

Statement of Cash Flows
•
Statement that summarizes the sources
and uses of cash
•
Changes divided into three major
categories
–
Operating Activity – includes net income and
changes in most current accounts
–
Investment Activity – includes changes in
fixed assets
–
Financing Activity – includes changes in notes
payable, long-term debt and equity accounts
as well as dividends

Sample Statement of Cash Flows - $000s
Cash, beginning of year $6,489
Operating Activity
I/F Net Income $471,916
Plus:
I/F Depreciation 362,325
I/F Increase in A/P -$26,934
I/F