Bookkeeping 25

Question 1

1. The OPERATING STATEMENT shows:

Answer 1

how much the firm has earned (or lost) during the accounting period.

Question 2

2. The BALANCE SHEET shows:

Answer 2

The CUMULATIVE EFFECT of the firm´s operations on THE FINANCIAL POSITION OF THE OWNERS.

Question 3

3. Where do you get the information for the BALANCE SHEET?

Answer 3

from Columns 9 and 10 of the worksheet.

Question 4

4. What is the FORMAT for the BALANCE SHEET?

Answer 4

ASSETS LIABILITIES
curr ass current liab
plant ass long term liab
OWN´S EQUI

Tot Ass..xx Tot Liab&Cap…xx

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Question 5

5. What is the GROUPING for ASSETS on the BALANCE SHEET?

Answer 5

ASSETS
  Current Assets
     Cash.................12k
     Acc Rec.............24k
     Inv.....................10k
         Tot Curr Assets         46k
  Plant Assets
      Equip................11k
      Less Acc Dep......1k
         Tot Plant Ass............10k

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Question 6

6. What is the CUMULATIVE DEPRECIATION on the BALANCE SHEET?

Answer 6

It is shown as a DEDUCTION from the ORIGINAL VALUE of the PLANT ASSETS (equipment).