The accounts receivable balance for a given time is the balance from the

# The accounts receivable balance for a given time is

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The accounts receivable balance for a given time is the balance from the previous time (e.g., month) plus debits to the account less credits to the account. Payment from service bureau, 11/11 charges
Asset Account Medical Insurance Date Explanation Debit Credit 12/1/2011 Purchase of medical policy \$ 6,864 12/31/2011 Expiration of one month coverage \$ 1,144 Balance =L179-M180 How are costs and revenues matched? 10 For the following data, how would the recording of expenses differ if Office Supplies were allocated over 12 months and the Personal Computer were depreciated (expense) over 3 years? What is the impact on net income? Income Statement 1/31/2010 Marble Designs, Inc. Sales \$10,000 \$10,000 Expenses Salary \$3,500 \$3,500 Office lease \$900 \$900 Telephone \$96 \$96 Office supplies \$2,000 \$166.67 Purchase: Computer \$1,950 \$54.17 Total Expenses \$8,446 \$4,717 Net Income \$1,554 \$5,283 11 How do cash and working capital differ? Calculate working capital for the data below. Income Statement Changes to Balance Sheet, 1/1 - 1/31 \$40,209 Assets Revenues \$40,179 \$40,209 Sales \$10,000 Cash \$9,000 \$2,554 Less Cost of Goods Sold Accounts Receivable \$8,000 Beginning Inventory \$0 Inventory \$1,500 Purchases \$2,000 Office Supplies \$1,833 Ending inventory \$1,500 \$500 Computer \$1,950 Accumulated depreciation -\$54 Gross profit \$9,500 \$9,000 \$15,783 Operating Expenses Salaries \$3,500 Liabilities and Owner's Equity Office Lease \$900 Telephone \$96 Notes payable \$2,000 Office supplies \$167 Jean Marble, equity \$9,000 \$13,783 Depreciation, Computer \$54 Net income \$4,783 \$9,000 \$15,783 Working capital \$9,000 \$11,887 12 Income Statement Changes to Balance Sheet, 1/31/10 - 1/31/11 1/31/2011 Assets 1/31/2010 1/31/2011 Revenues Sales \$90,000 Cash \$2,554 \$17,783 Beginning inventory \$1,500 Accounts Receivable \$8,000 \$5,500 Purchases \$25,000 Inventory \$1,500 \$2,000 Ending inventory \$2,000 Office Supplies \$1,833 \$1,833 Less Cost of Goods Sold \$24,500 Computer \$1,950 \$1,950 An analysis of cash flow can help determine how a company uses its cash assets. Is it used to acquire assets, meet liabilities, retire debt etc. The starting point of a cash flow analysis is a review of the income statement and balance sheet.
Computer \$2,320 Gross profit \$65,500 Accumulated depreciation -\$54 -\$1,091 \$15,783 \$30,295 Operating Expenses Salaries \$42,000 Liabilities and Owner's Equity Office Lease \$10,800 Telephone \$1,151 Notes payable \$2,000 \$3,000 Office supplies \$2,000 Jean Martin, equity \$13,783 \$27,295 Depreciation, Computers \$1,037 Gain on sale of office \$5,000 \$15,783 \$492,315 Net income \$13,512 Working capital \$11,887 \$24,116 13 Considering the above income statement and balance sheet: What was the value of the materials in inventory at the beginning of the period? 14 How much additional inventory was purchased during the year? 15 How mych inventory was used during the year? 16 Calculate the working capital for both month end periods. 17 What was the cash on hand at the end of Jan 2011?
1 What is statement analysis? 2 3 The following is a balace sheet displaying two year's data on a company. Common-size the report. Place results in the columns headed Common-sized. Calculate the Dollar Change and the Percent Change from 2012 to 2013. Place results in the Dollar Chg & Pct Chg columns.

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