STATEMENTS OF FINANCIAL POSITION (SFP).pptx

A presentation for the first topic on Fundamentals of Accounting and business management 2

1. STATEMENTS OF FINANCIAL POSITION (SFP)

2. Objectives; Review balance sheet elements Differentiate currents assets from noncurrent assets Differentiate current liabilities from noncurrent liabilities Prepare a statement of financial position under account form and report form Solve accounting problems relative to the balance sheet .

3. FINANCIAL STATEMENTS Are a structured representation of the financial position and financial performance of an entity. The objective of financial statements is to provide information about the financial position, financial performance and cash flows of an entity that is useful to wide range of users in making economic decisions.

4. FINANCIAL STATEMENTS Also show the results of the managements stewardship of the resources entrusted to it. To meet this objective, financial statements provide information about entity’s:

5. assets; liabilities equity; income and expenses, including gains and losses; contributions by and distribution to owner’s in their capacity as owners; and cash flows This information, along with other information in the notes, assists users of financial statements in predicting the entity’s future cash flows, and in particular, their timing and certainty

6. Review of balance sheet elements ASSETS – is a resource controlled by an entity as a result of past events and from which future economic benefits are expected to flow to the entity

7. Liabilities Is the present obligation of the entity arising from past events, the settle of which is expected to result in an outflow from the entity of resources embodying economic benefits.

8. Equity Is the residual interests in the assets of the entity after deducting all its liabilities.

9. ASSETS LIABILITIES CAPITAL

10. Current assets Noncurrent assets Current liabilities noncurrent liabilities CAPITAL

11. Current assets Noncurrent assets Current liabilities noncurrent liabilities

12. Current assets Noncurrent assets Current liabilities noncurrent liabilities

13. Current assets Noncurrent assets Current liabilities noncurrent liabilities

14. Current assets Noncurrent assets Current liabilities noncurrent liabilities

15. Current assets Noncurrent assets Current liabilities noncurrent liabilities

16. CURRENT ASSETS An entity shall classify an asset as current assets when: Cash Account receivables Inventories Prepaid expenses Office and store supplies Marketable equity securities

17. CURRENT ASSETS An entity shall classify an asset as current assets when: Cash Account receivables Inventories Prepaid expenses Office and store supplies Marketable equity securities

18. CURRENT ASSETS An entity shall classify an asset as current assets when: Cash Account receivables Inventories Prepaid expenses Office and store supplies Marketable equity securities

19. CURRENT ASSETS An entity shall classify an asset as current assets when: Cash Account receivables Inventories Prepaid expenses Office and store supplies Marketable equity securities

20. CURRENT ASSETS An entity shall classify an asset as current assets when: Cash Account receivables Inventories Prepaid expenses Office and store supplies Marketable equity securities

21. CURRENT ASSETS An entity shall classify an asset as current assets when: Cash Account receivables Inventories Prepaid expenses Office and store supplies Marketable equity securities

22. CURRENT ASSETS An entity shall classify an asset as current assets when: Cash Account receivables Inventories Prepaid expenses Office and store supplies Marketable equity securities

23. NONCURRENT ASSETS All other assets (that are not current) shall be classified as noncurrent.

24. CURRENT LIABILITIES An entity shall classify a liabilities as current when:

25. CURRENT LIABILITIES An entity shall classify a liabilities as current when:

26. NONCURRENT LIABILITIES All other liabilities (that are not current) shall be classified as noncurrent liabilities. BONDS PAYABLE LONG TERM NOTES PAYABLE

27. Determine if the following are current assets, noncurrent assets, current liabilities, and noncurrent liabilities

28. Determine if the following are current assets, noncurrent assets, current liabilities, and noncurrent liabilities

29. ACCOUNT FORM BALANCE SHEET

30. Report form balance sheet

31. Preparation of statements of financial position

32. Current Liability noncurrent Liability Current asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent Liability Current asset Current asset noncurrent asset noncurrent Liability Equity Current asset noncurrent asset Current Liability Current Liability Current asset

33. Current Liability noncurrent Liability Current asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent Liability Current asset Current asset noncurrent asset noncurrent Liability Equity Current asset noncurrent asset Current Liability Current Liability Current asset

34. Current Liability noncurrent Liability Current asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent Liability Current asset Current asset noncurrent asset noncurrent Liability Equity Current asset noncurrent asset Current Liability Current Liability Current asset

35. Current Liability noncurrent Liability Current asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent Liability Current asset Current asset noncurrent asset noncurrent Liability Equity Current asset noncurrent asset Current Liability Current Liability Current asset

36. Current Liability noncurrent Liability Current asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent Liability Current asset Current asset noncurrent asset noncurrent Liability Equity Current asset noncurrent asset Current Liability Current Liability Current asset

37. Current Liability noncurrent Liability Current asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent Liability Current asset Current asset noncurrent asset noncurrent Liability Equity Current asset noncurrent asset Current Liability Current Liability Current asset

38. Current Liability noncurrent Liability Current asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent Liability Current asset Current asset noncurrent asset noncurrent Liability Equity Current asset noncurrent asset Current Liability Current Liability Current asset

39. Current Liability noncurrent Liability Current asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent Liability Current asset Current asset noncurrent asset noncurrent Liability Equity Current asset noncurrent asset Current Liability Current Liability Current asset

40. Current Liability noncurrent Liability Current asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent Liability Current asset Current asset noncurrent asset noncurrent Liability Equity Current asset noncurrent asset Current Liability Current Liability Current asset

41. Current Liability noncurrent Liability Current asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent Liability Current asset Current asset noncurrent asset noncurrent Liability Equity Current asset noncurrent asset Current Liability Current Liability Current asset

42. Current Liability noncurrent Liability Current asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent Liability Current asset Current asset noncurrent asset noncurrent Liability Equity Current asset noncurrent asset Current Liability Current Liability Current asset

43. Current Liability noncurrent Liability Current asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent Liability Current asset Current asset noncurrent asset noncurrent Liability Equity Current asset noncurrent asset Current Liability Current Liability Current asset

44. Current Liability noncurrent Liability Current asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent Liability Current asset Current asset noncurrent asset noncurrent Liability Equity Current asset noncurrent asset Current Liability Current Liability Current asset

45. Current Liability noncurrent Liability Current asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent Liability Current asset Current asset noncurrent asset noncurrent Liability Equity Current asset noncurrent asset Current Liability Current Liability Current asset

46. Current Liability noncurrent Liability Current asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent Liability Current asset Current asset noncurrent asset noncurrent Liability Equity Current asset noncurrent asset Current Liability Current Liability Current asset

47. Current Liability noncurrent Liability Current asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent Liability Current asset Current asset noncurrent asset noncurrent Liability Equity Current asset noncurrent asset Current Liability Current Liability Current asset

48. Current Liability noncurrent Liability Current asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent Liability Current asset Current asset noncurrent asset noncurrent Liability Equity Current asset noncurrent asset Current Liability Current Liability Current asset

49. Current Liability noncurrent Liability Current asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent Liability Current asset Current asset noncurrent asset noncurrent Liability Equity Current asset noncurrent asset Current Liability Current Liability Current asset

50. Current Liability noncurrent Liability Current asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent Liability Current asset Current asset noncurrent asset noncurrent Liability Equity Current asset noncurrent asset Current Liability Current Liability Current asset

51. Current Liability noncurrent Liability Current asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent asset noncurrent Liability Current asset Current asset noncurrent asset noncurrent Liability Equity Current asset noncurrent asset Current Liability Current Liability Current asset

52. Let us try some multiple-choice problem regarding the accounting equation and the statement of financial position. Problem 1. Gissele company has a current assets of 4, 350, 000 and total liabilities of 2, 890, 000. If capital is 8,000,000 how much is entity’s noncurrent assets? 6, 540,000 9,430,000 10,890,000 Insufficient Information

53. Let us try some multiple-choice problem regarding the accounting equation and the statement of financial position. Problem 1. Gissele company has a current assets of 4, 350, 000 and total liabilities of 2, 890, 000. If capital is 8,000,000 how much is entity’s noncurrent assets? 6, 540,000 9,430,000 10,890,000 Insufficient Information

54. Cash 890,000 Trade receivables 450,000 Inventories 400,000 ______________ Total assets 1,740,000