Download - Unit_2_Financial Statement and Ratio
-
7/23/2019 Unit_2_Financial Statement and Ratio
1/37
UNIT 2:FINANCIAL
STATEMENTS ANDRATIOS
-
7/23/2019 Unit_2_Financial Statement and Ratio
2/37
-
7/23/2019 Unit_2_Financial Statement and Ratio
3/37
SAMPLE OF BALANCE SHEETBalance SheetAccount Description Debit Credit------- ------------------------------ ---------- ----------1400 1500.00
1000 899.011100 1000.001300 2100.99---------- ----------Total Assets 5500.00
2100 3500.00
---------- ----------Total Liabilities 3500.00
3100 4000.003200 2000.00---------- ----------Total Equity 2000.00
---------- ----------Total Liabilities and Equity 5500.00
-
7/23/2019 Unit_2_Financial Statement and Ratio
4/37
SAMPLE OF PROFIT AND LOSS STATEMENT
-
7/23/2019 Unit_2_Financial Statement and Ratio
5/37
MATCH
-
7/23/2019 Unit_2_Financial Statement and Ratio
6/37
A B
1. Consolidated a. Assets
2. Retained b. Receivables
. C!""ent c. Ea"nin#s
$. Total d. Stoc%
&. Acc!'!lated e. (ains
). Intan#ible *. Liabilities
+. Co''on #. A,liates
g.
c
b
f
e
a
d
-
7/23/2019 Unit_2_Financial Statement and Ratio
7/37
_______________ a. An asset which does not have a physical nature(such as a trademark or a patent).
_______________ b. The holding company owns a minority interest(less than 50%), but the accounts are nevertheless consolidated._______________ c. The total legal obligations of a company to payother parties
_______________ d. The ordinary shares by the owners, whotherefore the last to receive their money back in the event of
liquidation_______________ e. Amounts that will be collected in the normalcourse of business within one year.
_______________ f. Profit which is not paid out to shareholders inthe form of dividends, but instead is kept by the company toreinvest or pay off debts.
_______________ g. The amounts affecting common stockholders,but not from movements in the stock of the company (e.g.currency translation adjustments)
-
7/23/2019 Unit_2_Financial Statement and Ratio
8/37
a. Intangible assets
b. Consolidated affiliates
c. Total liabilites
d. Common stock
e. Current receivables
f. Retained earnings
g. Accumulated gains
-
7/23/2019 Unit_2_Financial Statement and Ratio
9/37
FILL IN THE TABLE
U.K U.S.A Vietnam
Balance sheet Statement of
Financial Position
Bo co ti
chnh
Profit and Loss
Statement
Statement of
Earnings
Bn bo co
li l
Shareholder Stockholder C ng
Stock Inventory Bn k ti
snGearing Leverage T s vn vay
-
7/23/2019 Unit_2_Financial Statement and Ratio
10/37
Balance sheet:- A written statement showing the amount of moneyand property a company has- The money received from shareholders and creditors(bng quyt ton, bng cn i k ton, bng i chiuti sn v n, bng tng kt ti sn)
-
7/23/2019 Unit_2_Financial Statement and Ratio
11/37
Net earnings
a It's better than last year.
e A lot more this year.
f It's not as low as two years ago
-
7/23/2019 Unit_2_Financial Statement and Ratio
12/37
Interest and financial charges
b It's gone down since last year.
Basic earnings per share
h It's exactly the same.
-
7/23/2019 Unit_2_Financial Statement and Ratio
13/37
Earnings before income taxes andaccounting changes
f It's not as low as two years ago
e A lot more this year
-
7/23/2019 Unit_2_Financial Statement and Ratio
14/37
Total revenues
f It's not as low as two years ago
e A lot more this year
a It's better than last year.
-
7/23/2019 Unit_2_Financial Statement and Ratio
15/37
Dividends declared per share
C Slightly more this year
Other costs and expenses
g It's virtually the same.
Sales of services
g It's virtually the same.
C Slightly more this year
-
7/23/2019 Unit_2_Financial Statement and Ratio
16/37
AccountantOK. Norma has asked me to go over someof the ratios I used in the report which I sent you lastweek. The first of these is on page 3 -working capital.Everyone got it? OK. Working capital is quite simple -
it's the current assets divided by the currentliabilities. Any questions? Yes. What's it for?AccountantWell, it basically tells us whether we haveenough short-term assets to cover our short termdebt. If we don't, we could be in trouble. OK? Good.Next isreturn on assets.This is net income plus
interest expense divided by total assets. Before youask, it allows us to evaluate the way we use ourassets. It can help us decide whether or not weshould start a new project, for example, bycomparing the return expected against the normalborrowing costs. Is that clear?
-
7/23/2019 Unit_2_Financial Statement and Ratio
17/37
AccountantI have a question. What'sdebt/asset ratio?
AccountantI was just coming to that. It'sthe total assets divided by total liabilities.It tells us what proportion of theenterprise's assets are being financedthrough the use of debt. If this ratio is high
in a market with increasing interest rates,creditors are going to get worried. Thedebt/asset ratio determines the fundingleverage of the enterprise. OK, if there areno questions, I'd like to ...
-
7/23/2019 Unit_2_Financial Statement and Ratio
18/37
(I-EDEFINITIONS (1) Working capital (2) Return on Assets (3) Debt/ Asset Ratio
tec!""entassets
dividedb/ tec!""ent
liabilities
net inco'e 0l!s
inte"est e0ensedivided b/ totalassets
total assetsdivided b/ totalliabilities
-
7/23/2019 Unit_2_Financial Statement and Ratio
19/37
SAIN( E3UATIONS4FORMULAS
Plus, add, and
Minus, less, subtract
Divided by,
times, multiplied byEquals, is
atimes (multiplied by)bequals
caminusbdivided by (or over)c
+-
=axb = c
a-b/ c
Note
x
-
7/23/2019 Unit_2_Financial Statement and Ratio
20/37
5RACTICE SAIN( 6..
7 + 8 = 15 20- 12= 8
2 x 6 = 12 50: 5 = 10
-
7/23/2019 Unit_2_Financial Statement and Ratio
21/37
COMMON RATIOS
ave"a#einte"est"ate
ea"nin#s
0e"sa"e
"et!"n on e7!it/
debt4e7!it/ "atio
-
7/23/2019 Unit_2_Financial Statement and Ratio
22/37
COMMON RATIOS
#"oss 0"o8t 'a"#in
invento"/t!"nove"
0"ice4ea"nin#s"atio
-
7/23/2019 Unit_2_Financial Statement and Ratio
23/37
a. ("oss 0"o8t 'a"#in: t9 s
#i; c