lesson 15-1
DESCRIPTION
LESSON 15-1. Preparing an Income Statement. INCOME STATEMENT INFORMATION ON A WORK SHEET. page 448. REVENUE SECTION OF AN INCOME STATEMENT FOR A MERCHANDISING BUSINESS. page 449. 1. 2. 3. 4. 5. 8. 9. 6. 7. 1.Heading. 6.Contra account amounts. 2.Revenue section. - PowerPoint PPT PresentationTRANSCRIPT
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 15-1LESSON 15-1
Preparing an Income Statement
2
LESSON 15-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
INCOME STATEMENT INFORMATION INCOME STATEMENT INFORMATION ON A WORK SHEETON A WORK SHEET page 448
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LESSON 15-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
6. Contra account amounts
REVENUE SECTION OF AN INCOME STATEMENT REVENUE SECTION OF AN INCOME STATEMENT FOR A MERCHANDISING BUSINESSFOR A MERCHANDISING BUSINESS
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22
33 44
55
66 7788 99
1. Heading
7. Contra account total
3. Title of revenue account 8. Net Sales
4. Sales amount 9. Net sales amount
5. Less contra accounts
2. Revenue section
page 449
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LESSON 15-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
COST OF MERCHANDISE SOLD SECTION OF AN COST OF MERCHANDISE SOLD SECTION OF AN INCOME STATEMENT FOR A MERCHANDISING INCOME STATEMENT FOR A MERCHANDISING BUSINESSBUSINESS
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2233
page 450
446655
1. Cost of Merchandise Sold section
2. Beginning inventory
3. Purchases section
4. Total cost of merchandise available for sale
5. Ending inventory
6. Cost of merchandise sold
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LESSON 15-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
COMPLETING AN INCOME STATEMENT COMPLETING AN INCOME STATEMENT FOR A MERCHANDISING BUSINESSFOR A MERCHANDISING BUSINESS
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22
44
55
page 452
77
3366
7. Component percentage
6. Double lines
5. Net Income after Federal Income Tax
4. Less Federal Income Tax Expense
3. Net Income before Federal Income Tax
2. Expenses section
1. Gross Profit on Sales
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LESSON 15-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
TERMS REVIEWTERMS REVIEW
net sales cost of merchandise sold gross profit on sales
page 454
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 15-2LESSON 15-2
Analyzing an Income Statement
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LESSON 15-2CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
ANALYZING AN INCOME STATEMENT ANALYZING AN INCOME STATEMENT SHOWING A NET LOSSSHOWING A NET LOSS page 457
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LESSON 15-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
Price-EarningsRatio
=Earnings
perShare
÷Market Price
per Share
Earningsper Share
=Number of
SharesOutstanding
÷Net Incomeafter FederalIncome Tax
FINANCIAL RATIOSFINANCIAL RATIOS page 459
Earnings per Share
Price-Earnings Ratio
$32.13=2,500÷$80,313.95
10.7=$32.13÷$345.00
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LESSON 15-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
TERMS REVIEWTERMS REVIEW
financial ratio earnings per share price-earning ratio
page 460
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 15-3LESSON 15-3
Preparing a Statement of Stockholders’ Equity
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LESSON 15-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
CAPITAL STOCK SECTION OF THE CAPITAL STOCK SECTION OF THE STATEMENT OF STOCKHOLDERS’ EQUITYSTATEMENT OF STOCKHOLDERS’ EQUITY
1122
3344
55
page 461
1. Heading
2. Capital Stock and Par Value
5. Total stock issued at the end of the year
3. Stock at the beginning of the year
4. Stock issued during the year
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LESSON 15-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
RETAINED EARNINGS SECTION OF THE RETAINED EARNINGS SECTION OF THE STATEMENT OF STOCKHOLDERS’ EQUITYSTATEMENT OF STOCKHOLDERS’ EQUITY
112233
44
page 462
4. Dividends declared
66
77
55
2. Beginning balance
7. Total stockholders’ equity6. Ending balance3. Net income after federal
income tax
5. Increase in retained earnings1. Retained Earnings
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LESSON 15-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
TERMS REVIEWTERMS REVIEW
statement of stockholders’ equity par value
page 463
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 15-4LESSON 15-4
Preparing a Balance Sheet
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LESSON 15-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
BALANCE SHEET INFORMATION BALANCE SHEET INFORMATION ON A WORK SHEETON A WORK SHEET page 464
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LESSON 15-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
CURRENT ASSETS SECTION CURRENT ASSETS SECTION OF A BALANCE SHEETOF A BALANCE SHEET
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33
44
55
page 465
3. Book value of accounts receivable
4. Remaining current asset accounts1. Heading
2. Begin assets section 5. Current assets
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LESSON 15-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
PLANT ASSETS SECTION PLANT ASSETS SECTION OF A BALANCE SHEETOF A BALANCE SHEET
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22
33
page 466
44
551. Write the heading Plant Assets.
2. Calculate the book value of office equipment.
3. Use the same procedure to calculate the book value of store equipment.
4. Calculate total plant assets.
5. Calculate total assets.
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LESSON 15-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LIABILITIES SECTION LIABILITIES SECTION OF A BALANCE SHEETOF A BALANCE SHEET
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33
page 467
1. Heading
2. Account title and amount of each current liability
3. Total liabilities
22
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LESSON 15-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
STOCKHOLDERS’ EQUITY SECTION STOCKHOLDERS’ EQUITY SECTION OF A BALANCE SHEETOF A BALANCE SHEET
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page 468
5. Total liabilities and stockholders’ equity
44
55
2233
2. Capital stock
1. Stockholders’ Equity
3. Retained earnings
4. Total stockholders’ equity
6. Double rules66
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LESSON 15-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
COMPLETED BALANCE SHEETCOMPLETED BALANCE SHEET page 469
(continued on next slide)
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LESSON 15-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
COMPLETED BALANCE SHEETCOMPLETED BALANCE SHEET page 469(continued from previous
slide)
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LESSON 15-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
TERMS REVIEWTERMS REVIEW
current liabilities long-term liabilities supporting schedule
page 471