...RUNNING HEAD: FINANCIAL STATEMENTS PAPER PART I Financial Statement Part I Paper Sonya Spencer – King University of Phoenix September 20, 2010 Introduction to Financial Statements The intention of this paper is to explain the essential structure of a financial statement and its sole purpose. While identifying the viewers, purpose and nature of the financial statements, stockholders and investors can make logical decisions that are in the best interest of the company. Financial statements also allow managers to thoroughly understand how to make informed and ethical business decisions by using financial accounting information. Landry’s and its History Landry’s became a publicly traded company in 1993, and since then has became a mounting, stable company, whom currently owns numerous restaurant chains. During the years of 2001 until 2003, Landry’s assets increased tremendously while maintaining an affirmative cash flow. By maintaining an affirmative cash flow, along with extremely low expenses, proves many analysis’s theories of why Landry’s is known as a leader in the restaurant industry. What the Income Statement Tells You about the Company In reviewing the information listed, one came immediately determine from the income statement that Landry’s total net income from the year ending December 31, 2003 was 45,901...
Words: 1102 - Pages: 5
...Financial Statements Paper Part I Student ACC 497 8.17.2015 Professor Financial Statement Paper Part I: Home Depot For employees, creditors, and investors, financial statements are essential. They provide insight and information regarding a company’s overall performance. The Securities and Exchange Commission (SEC) requires that all publicly traded companies release their financial statements on a regular basis – quarterly and annually. The annual report consists of three main reports: the consolidated statement of earnings (the income statement), the balance sheet, and the statement of cash flows. The following is a discussion of Home Depot’s 2008 Annual Report. Home Depot is a large, retail chain that specializes in home improvement. The income statement, its importance, what decisions it aids The income statement helps to understand a company’s financial performance. In plain terms, the income statement shows how a company made a profit or suffered a loss during a set period of time. The income statement is generated with a very simple formula of subtracting all Expenses from Revenues, thus arriving at the Profit or Loss. The income statement simplifies everything by merging all of the major expense accounts under one, more generic label. This simplicity aids any users of the income statement to have easy comprehension, and have a higher level of overview of the operation’s performance. Investors are able to forecast probable stock prices rising and...
Words: 1224 - Pages: 5
...Financial Statements Paper 2 Financial Statements Paper Part I Keeping accurate financial statements for a company should be the number one goal of the company's financial team. Falsifying financial information can lead to misrepresentation of the company's financial status can lead to bad financial decisions and possible disaster of the business. There are three important financial statements for a business that provide management and shareholders financial information that can be key to financial decisions made by each. Those important financial statements of a business are the income statement, the balance sheet, and the cash flows statement. The income statement tells about a company's financial results for the financial year reported. Some information contained within the financial statements of a company would be profit or loss, the amount of expenses and revenue, and the operational efficiency of the company. The importance of an income statement of a company is that it shows the operational efficiency or inefficiency. The income statement after being evaluated will help shareholders make a decision if they would want to buy shares in the company. By finding positive figures shareholders will be likely to not sell their holdings increasing the market price of the shares; however should there be a negative finding the shareholders may choose to sell their shares causing a decrease in the market price. The information...
Words: 1058 - Pages: 5
...Financial Statements Paper - Part I Bridgette Toutant ACC/497 March 31, 2014 Ken Goranson Financial Statements Paper - Part I A financial statement offers users, such as management, board of directors, and potential investors, information related to the company’s activities and it gives them the ability to make decisions in relation to the company. A certain amount of urgency should exist when providing this useful information because the financial statements are considered to be a powerful and commonly used tool. The most commonly used of all the financial statements would be the income statement because it can be used to examine the profits and losses of a company. Many users do also find that the balance sheets and cash flow statements just as useful in the decision making process. The following will include the analysis of Home Depot’s annual report by examining the income statement, balance sheet, and cash flow statement and looking at how they can help with business decisions. The Consolidated Statements of Earnings, the income statement, tells the user about the sales and expenses of Home Deport during each fiscal year. Analyzing the income statement for Home Depot, it appears that the company had strong sales numbers of over $71 billion each year. Even though the company was able to keep sales over $71 billion, it is noticeable that the sales and gross profits declined from 2007 to 2009 (The Home Depot, 2009). It also seems that an increase in expenses...
Words: 1358 - Pages: 6
...questions that can be answered. Questions regarding what the income statement includes, what it says about Home Depot, why it is important, and what decisions can be made from the financial statement. The same can be answered about both the balance sheet and the statement of cash flows as well. Each financial statement is important and useful in its own way and all of the three financial statements are beneficial for management within Home Depot. According to “Beginners’ Guide to Financial Statements” (2007), “an income statement is a report that shows how much revenue a company earned over a specific time period (usually for a year or some portion of a year)”. There are two different types of income statements, single and multiple and Home Depot uses the multiple-step income statement. With that being said, this income statement includes both operating expenses as well as non-operating expenses. By reviewing the income statement for Home Depot, it looks as though net sales, cost of sales, and gross profit have all decreased over the latest three years recorded. On another note the operating expenses and non-operating expenses have both increased over the latest three years. “The income statement shows revenues, expenses, gains, and losses; it does not show cash receipts (money you receive) nor cash disbursements (money you pay out)” (Income Statement (Profit and Loss Statement), 2012). The income statement is important to many individuals including bankers/lenders/creditors...
Words: 1114 - Pages: 5
...Financial Statement Paper Part I Armanda Gamboa ACC/497 May 25, 2015 Silvana Moffitt Financial Statement Paper Part I Upon making business decisions there are three types of financial statements that should be looked at and reviewed prior to making any decision. The three statements are the consolidated statement of earnings (income statement), balance sheet, and the statement of cash flows. The income statement will prove the company’s profitability, the balance sheet will provide a look at the company’s financial stand, and the statement of cash flow will tell where the cash came from and where the cash is going. Home Depot Inc. is a large home improvement retailer that has over 2,200 stores worldwide and has been in business since 1978. Looking at the financial statements for the year 2008 means there are several previous years that can be compared these statements. This will allow anyone who is curious about the financial situation of Home Depot to compare statements to previous years to determine the growth and success of the business. While reviewing the consolidated financial statement for Home Depot Inc year 2008 it proved that due to the decline in the economy there was a decline in revenue for them as well compared to their 2007 statement. The difference in net earnings from 2007 to 2008 are proven to be extremely large at 50% decline. On the 2007 income statement net earnings were at $4.4 billion with diluted earnings per share of $2.37 which is now compared...
Words: 895 - Pages: 4
...Given Data CP2-1 7. Problem A 2-1 8. Given Data PA 2-1 ACC 300 week 2 dqs. What are the different bases of accounting? When would you use the cash basis? Accrual basis? Tax basis? Which one is better? Why? What are the financial statements? What does each one tell you? Which financial statement is more important? Why? How are the financial statements related? Why do these relationships exist? What is the impact of a miscalculation in the income statement on other financial statements? ACC 300 Week 3 – Individual Assignment Part I. In the work ACC 300 Week 3 Individual Assignment Part I you will find overview of the following parts: 1. Cash Basis – Income Statement 2. Accrual Basis – Income Statement ACC 300 Week 3 – Individual Assignment Part II. In this file ACC 300 Week 3 Individual Assignment Part II you will find overview of the following tables: 1. Income Statement 2. Statement of changes in Stockholders’ Equity 3. Expense recognition principle 4. Balance Sheet as of December 31, 2002 5. Statement of Cash Flows ACC 300 Week 3 – Individual Assignment Part III. In the work ACC 300 Week 3 Individual Assignment Part III you will find overview of the following tables: 1. Cash Basis – Income Statement 2. Statement of...
Words: 1163 - Pages: 5
...2-1 Given Data CP2-1 Problem A 2-1 Given Data PA 2-1 ACC 300 week 2 dqs. What are the different bases of accounting? When would you use the cash basis? Accrual basis? Tax basis? Which one is better? Why? What are the financial statements? What does each one tell you? Which financial statement is more important? Why? How are the financial statements related? Why do these relationships exist? What is the impact of a miscalculation in the income statement on other financial statements? ACC 300 Week 3 – Individual Assignment Part I. In the work ACC 300 Week 3 Individual Assignment Part I you will find overview of the following parts: Cash Basis – Income Statement Accrual Basis – Income Statement ACC 300 Week 3 – Individual Assignment Part II. In this file ACC 300 Week 3 Individual Assignment Part II you will find overview of the following tables: 1. Income Statement 2. Statement of changes in Stockholders’ Equity 3. Expense recognition principle 4. Balance Sheet as of December 31, 2002 5. Statement of Cash Flows ACC 300 Week 3 – Individual Assignment Part III. In the work ACC 300 Week 3 Individual Assignment Part III you will find overview of the following tables: Cash Basis – Income Statement Statement of...
Words: 1188 - Pages: 5
...History INTEGRATED CASE APPLICATION — PINNACLE MANUFACTURING: PART II a. Identification of specific considerations from Parts I and II b. Assessment of acceptable audit risk c. Identification inherent risks INTEGRATED CASE APPLICATION — PINNACLE MANUFACTURING: PART III (1) Controls (2) Deficiencies (3) Control risk Assessment Integrated Case Application- Pinnacle Manufacturing I. Organizational History Pinnacle was set up in 1996 in Pithampur, near city of Indore in Madhya Pradesh (INDIA). Over the last several years the company has continuously invested in and expanded its technology partnerships, manufacturing systems, product range and clientele to emerge as India’s largest commercial vehicle, bus seating and Interiors Company. [pic] INTEGRATED CASE APPLICATION — PINNACLE MANUFACTURING: PART II a. Identify specific considerations from Parts I and II of the case that affect your assessments of engagement risk and acceptable audit risk. Use each of the three factors in the text to categorize your conclusions: ▪ External users’ reliance on financial statements ▪ Likelihood of financial difficulties ▪ Management integrity Definitions (from textbook) ...
Words: 916 - Pages: 4
...last accounting class, one thing I learned how important financial statements are in accounting. All the accounting professors put so important on financial statements because one of their objective is to make sure students are well familiar with financial statement before graduating. Financial Accounting is the procedure of delivering data to the outsiders in a special report call financial statement. Accounting field uses financial statements to give data about money related position and execution to different business groups. Financial statements are used by Managers, Investors, Suppliers, Customers, Competitors, and Governments to stay with the track about fund and settling on economic choices. Financial statements covered organization two important reports, which are Balance Sheet and Income Statements. Balance sheet and income statement are important for accounting field to put yearly or month to month financial statements. Financial statements utilizes language of fundamental accounting, currency, and numbers. Financial statements of a business are used to give data about the status of the business. In accounting field financial statements give the information of organizations to mangers or other companies. To settle on all around informed choices, invested individuals must have the capacity to accept that an organization's financial statements are an accurate representation of its performance. According to the article Objectives of Financial Accounting and Reporting from...
Words: 1358 - Pages: 6
...Financial Statements Papers Part I Sherrie Christian ACC/497 April 8, 2013 Rick Kwan, MBA Financial Statements Papers Part I The financial statements are important as they inform the users of the economic health and stability of the entity. Each financial statement provides information to determine economic health, such as financial position, performance, and changes. Assets, liabilities, and equity provide a measurement of financial position. Income and expenses provide a measurement of performance. The income statement is a vital section of the financial statements, also known as the profit and loss statement. The income statement presents revenue balances, and profits for a specific period of reporting. The income statement presents sales, cost of sales, operating and non-operating expenses, and the income for the prior three reporting periods. The income statement presents awareness of changes or the lack of changes in the sales balances, cost of sales, and operating and non-operating expenses. The income statement provides comparisons of prior reporting periods to current reporting periods. The income statement measures the business performance in terms of revenue, and net income. Managers practice income statement analysis to work out inefficiencies, and processes that are ineffective. Revenue, expenses, and net income are the major parts of the income statement. A financial statement user can view the Home Depot Statement of Earnings for the fiscal year ending...
Words: 1069 - Pages: 5
...Accounting FOR DUMmIES 4TH ‰ EDITION By John A. Tracy, CPA Accounting For Dummies®, 4th Edition Published by Wiley Publishing, Inc. 111 River St. Hoboken, NJ 07030-5774 www.wiley.com Copyright © 2008 by Wiley Publishing, Inc., Indianapolis, Indiana Published by Wiley Publishing, Inc., Indianapolis, Indiana Published simultaneously in Canada No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Sections 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, 222 Rosewood Drive, Danvers, MA 01923, 978-750-8400, fax 978-646-8600. Requests to the Publisher for permission should be addressed to the Legal Department, Wiley Publishing, Inc., 10475 Crosspoint Blvd., Indianapolis, IN 46256, 317-572-3447, fax 317-572-4355, or online at http:// www.wiley.com/go/permissions. Trademarks: Wiley, the Wiley Publishing logo, For Dummies, the Dummies Man logo, A Reference for the Rest of Us!, The Dummies Way, Dummies Daily, The Fun and Easy Way, Dummies.com and related trade dress are trademarks or registered trademarks of John Wiley & Sons, Inc. and/or its affiliates in the United States and other countries, and may not be used without written permission. All...
Words: 151136 - Pages: 605
...General Mills Inc.—Understanding Financial Statements Teaching Notes: This is the first case we use in our course and it sets the tone. We find that using a company well-known to students piques their interest and gets the course off to a good start. The purpose of the case is to gain familiarity with financial statements and to begin to think about how financial statements reflect economic events and financial performance. Some students need to be reminded that the point of the exercise is not to perform a comprehensive analysis of the company. At this point, most students do not have the required skills. Rather, the goal is one of discovery. Many students find that they understand a lot more of the information in the financials than they thought they would. Others find that the vocabulary bogs them down. They need to be encouraged to learn the language of business. A productive exercise is to have students jot down a few (3-5) items they find puzzling in the financial statements. Then, on the last day of class, have the students refer back to their list. Typically, they understand everything they had on their day-one list. This provides tangible evidence of the value of the course because most students are pleasantly surprised at how much they have learned. The case probes the three basic statements as well as the two opinions issued by the firms’ auditors. This provides the opportunity to introduce the notions of corporate governance and ethics. The case includes basic questions...
Words: 2946 - Pages: 12
...assets to be disposed of together as a group in a single transaction | | Non-current assets (or disposal groups) are classified as held for sale if carrying amount is expected to be recovered principally through a sale transaction and not through continuing use. | | Non-current assets (or disposal groups) classified as held for sale reported separately (from other assets) in the statement of financial position. | | Non-current assets (or disposal groups) held for sale are measured at the lower of carrying amount and fair value less costs to sell | | A discontinued operation is a component of an entity that has been disposed of or is classified as held for sale and satisfies one of the following conditions: (i)represents a separate major line of business or geographical area of operations (ii) is part of a single plan to dispose of a separate major line of business or geographical area of operations (iii)is a subsidiary acquired exclusively for the purpose of resale. | | disclosure requirement in the statement of comprehensive income is the sum of (1) and (2) is reported as a single amount in the...
Words: 527 - Pages: 3
...Ch.1-1 The city of Sacramento, California published their Comprehensive Annual Financial Report (CAFR) in December 2014 for the fiscal year ended June 30, 2014. The CAFR breaks down and explains the financial accounting for the city during that time. Under both federal and state law, this report is in compliance with the accountability required so the voters can see how the money the city collects and receives is utilized. They cite the Article IX of the City’s Charter to prove accountability and establish a third party verification of the report. Article IX allows under Section 44 for an independent auditor to review and certify the CAFR is accurate. Under this review, they describe the charter-government functions of Sacramento. The Introduction Letter is broken down into distinct sections, each touching on various operational aspects of the city including estimated population, services the government provides to the populace, and overview of the city’s profile. This profile includes the location and general statistics of the city itself. One section of the introduction letter is how the financial funds the city uses are set and defined. There are four separate, legal entities that make up the fiscal operations of the City. In discussing the current and future plans of the city, a positive note was reported that the city, using funds collected from Measure U, a ½ cent increase of sales and use taxes, provided enough extra funding for the city to maintain general...
Words: 2368 - Pages: 10
