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Foundations Of Financial Management
Found in: Page 50
Foundations Of Financial Management

Foundations Of Financial Management

Book edition 16th
Author(s) Stanley B. Block, Geoffrey A. Hirt, Bartley Danielsen
Pages 768 pages
ISBN 9781259277160

Short Answer

Fill in the blank spaces with categories 1 through 7:

1. Balance sheet (BS)

2. Income statement (IS)

3. Current assets (CA)

4. Fixed assets (FA)

5. Current liabilities (CL)

6. Long-term liabilities (LL)

7. Stockholders’ equity (SE)

Indicate whether item is on Balance sheet (BS) or Income statement (IS)

If on Balance sheet, designate which category

Item

Accounts receivable

Retained earnings

Income tax expense

Accrued expense

Cash

Selling and administrative expenses

Plant and equipment

Operating expenses

Marketable securities

Interest expense

Sales

Notes payable (6 month)

Bonds payable, maturity 2019

Common stock

Depreciation expense

Inventories

Capital in excess of par value

Net income (earning after tax)

Income tax payable

The balance sheet items are accounts receivable, retained earnings, accrued expenses, cash, plant and equipment, marketable securities, notes payable, bonds payable, common stock, inventories, capital in excess of par value, and income tax payable. And income tax expenses, selling and administrative expenses, operating expenses, interest expenses, sales, depreciation expenses, and net income are the income statement items.

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Step by Step Solution

Balance sheet

A balance sheet is a component of the financial statements prepared by the management of the company to represent the financial position of the company.

Categorization of balance sheet items

Indicate whether the item is on the balance sheet (BS) or income statement (IS)

If on the balance sheet, designate which category

Item

Balance sheet

Current asset

Accounts receivable

Balance sheet

Stockholder’s equity

Retained earnings

Income statement

-

Income tax expense

Balance sheet

Current liability

Accrued expense

Balance sheet

Current asset

Cash

Income statement

-

Selling and administrative expenses

Balance sheet

Fixed asset

Plant and equipment

Income statement

-

Operating expenses

Balance sheet

Current assets

Marketable securities

Income statement

-

Interest expense

Income statement

-

Sales

Balance sheet

Current liability

Notes payable (6 months)

Balance sheet

Long term liability

Bonds payable, maturity 2019

Balance sheet

Stockholder’s equity

Common stock

Income statement

-

Depreciation expense

Balance sheet

Current asset

Inventories

Balance sheet

Stockholder’s equity

Capital in excess of par value

Income statement

-

Net income (earnings after tax)

Balance sheet

Current liability

Income tax payable

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