Formulas Flashcards
Realized Gross Profit
Cash collected on installment sales for the period * Gross Profit Percentage on the sale.
Assets =
Liabilities + Equity
Cost of Goods Sold “COGS”
Beginning inventory + Purchases - Ending inventory
The Income Equation Income (Loss) =
Revenues + Gains - Expenses - Losses
Increase in current operating liabilities
Added to net income
Decrease in current operating assets
Added to net income
Increase in current operating assets
Subtracted from net income
Decrease in current operating liabilities
Subtracted from net income
Noncash losses and expenses included in net income
Added to net income
Losses and expenses whose cash effects are
related to investing or financing cash flows
Added to net income
Noncash gains and revenues included in net income
Subtracted from net income
Gains and revenues whose cash effects are
related to investing or financing cash flows
Subtracted from net income
Gross Profit Percentage
Gross profit on installment sales/ Installment sales
NRV of Accounts receivable
Net Realizable Value (NRV)
Gross accounts receivable - Allowance for Uncollectible accounts.
Reconciliation of the beginning and ending balances of gross accounts receivable “accounts receivable before adjustment for allowance for uncollectible accounts”
Beginning accounts receivable
Plus: Credit sales during the period
Less: Cash collected on credit sales during the period
Less: Accounts receivable written-off during the period
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Ending accounts receivable.
