Answer:
Summary of the debits and credits made in the previous period
Answer & Explanation:
Most balance sheets are arranged according to this equation:
Assets = Liabilities + Shareholders’ Equity
The equation above includes three broad buckets, or categories, of value which must be accounted for:
1. Assets
An asset is anything a company owns which holds some amount of quantifiable value, meaning that it could be liquidated and turned to cash. They are the goods and resources owned by the company.
Assets can be further broken down into current assets and noncurrent assets.
- Current assets are typically what a company expects to convert into cash within a year’s time, such as cash and cash equivalents, prepaid expenses, inventory, marketable securities, and accounts receivable.
- Noncurrent assets are long-term investments that a company does not expect to convert into cash in the short term, such as land, equipment, patents, trademarks, and intellectual property.
2. Liabilities
A liability is anything a company or organization owes to a debtor. This may refer to payroll expenses, rent and utility payments, debt payments, money owed to suppliers, taxes, or bonds payable.
As with assets, liabilities can be classified as either current liabilities or noncurrent liabilities.
- Current liabilities are typically those due within one year, which may include accounts payable and other accrued expenses.
- Noncurrent liabilities are typically those that a company doesn’t expect to repay within one year. They are usually long-term obligations, such as leases, bonds payable, or loans.
3. Shareholders’ Equity
Shareholders’ equity refers generally to the net worth of a company, and reflects the amount of money that would be left over if all assets were sold and liabilities paid. Shareholders’ equity belongs to the shareholders, whether they be private or public owners.
Just as assets must equal liabilities plus shareholders’ equity, shareholders’ equity can be depicted by this equation:
Shareholders’ Equity = Assets - Liabilities
— Courtesy of Harvard Business School
I hope this helped! :)
Answer:
Bank reconciliation for Candace Co. for May 31
Amount in $ Amount in $
Balance per Bank statement 2,936
Less;
Outstanding checks (465)
Add;
Deposits in transit 655
Bank charge 50
Erroneous check to supplier <u> 18</u> <u> 723</u>
Balance per cash account <u>3,194 </u>
Explanation:
The bank reconciliation is one done between the balance per the books and balance per the bank statement. This is usually as a result of transactions known as reconciling items.
These are items that have either been recognized in books but yet to be recorded by the bank or vice versa, transactions recorded wrongly by one of the parties etc.
The outstanding checks has been deducted from the cash book hence it will be deducted from the bank statement balance in the reconciliation statement.
The bank charges is yet to be recorded in the cash books as a deduction hence it will be added back to the bank statement balance in the reconciliation statement.
The bank deposit has been recorded as an inflow in the cash balance hence it will be added to the bank balance in the reconciliation statement.
The erroneous check amount difference
= $97 - $79
= $18
This will be added to the banks balance as it has been underdeducted in the cash balance in the reconciliation statement.
Answer:
44 days
Explanation:
Given: Number of days outstanding= 365
Ending Accounts payable= 
Cost of goods sold (COGS)= 
We always consider ending account payable amount while calculating days payable outstanding (DPO), as it is the amount that is payable to the vendor, supplier, etc. at the end of the period.
Formula; 
Days payable outstanding (DPO)= 
≅ 
∴ Barry bee´s average number of days payable outstanding are 44 days.
Days payable outstanding are calculated to know how company is managing the cash flow and account payable. Company with higher DPO takes higher number of days to pay it´s creditor, vendor, etc.
Use the following information for questions 55 and 56.
Armstrong Inc. is a calendar-year corporation. Its financial statements for the years ended 12/31/14 and 12/31/15 contained the following errors:
2014 2015
Ending inventory $25,000 overstatement $40,000 understatement
Depreciation expense 10,000 understatement 20,000 overstatement
<u>Answer:</u>
By $50,000 retained earnings at 12/31/15 is understated
Option c, $50,000 understatement
<u>Explanation:</u>
Given:
Ending inventory $25,000 overstatement $40,000 understatement
Depreciation expense 10,000 understatement 20,000 overstatement
To find:
The retained earnings amount to be overstated or understated at 12/31/15
When an amount is understated, it depicts the following two things,
- The amount is not the correct amount
- The amount is less than the true amount
Here, the reatianed earnings amount can be evaluated by the following step,
So, it can be finalised that the retained earnings of $50,000 is understated.
