Chapter 05 Communicating and Analyzing Accounting Information CHAPTER 5 COMMUNICATING AND ANALYZING ACCOUNTING INFORMATION HANDOUT 5 1 CLASSIFYING ACCOUNTS ON FINANCIAL STATEMENTS The following is a list of financial statement items and amounts from a recent income statement and balance sheet of Basic Corporation All accounts have normal balances The company s year ended on December 31 of the current year For each financial statement item listed indicate whether it appears on the income statement or balance sheet Financial Statement Item Income Statement Balance Sheet Accounts payable Accounts receivable Accrued expenses payable Additional paid in capital Cash and cash equivalents Common stock 10 par value Cost of sales General and administrative expenses Income tax expense Intangible assets net Interest and other income net Inventory Long term notes payable Other current assets Other current liabilities Other noncurrent assets Prepaid expenses Property plant and equipment net Research and development costs Retained earnings Sales and service revenues Selling expenses Short term investments Amount 41 000 262 000 37 000 70 000 125 000 100 000 350 000 75 000 32 000 85 000 10 000 167 000 433 000 5 000 89 000 15 000 31 000 184 000 250 000 161 000 943 000 125 000 57 000 McGraw Hill LLC All rights reserved No reproduction or distribution without the prior written consent of McGraw Hill LLC 5 1 Chapter 05 Communicating and Analyzing Accounting Information HANDOUT 5 2 PREPARATION OF BALANCE SHEET Using the information provided in Handout 5 1 prepare in good form a classified balance sheet as of December 31 of the current year McGraw Hill LLC All rights reserved No reproduction or distribution without the prior written consent of McGraw Hill LLC 5 2 Chapter 05 Communicating and Analyzing Accounting Information HANDOUT 5 3 PREPARATION OF INCOME STATEMENT Using the information provided in Handout 5 1 prepare in good form a multistep income statement including earnings per share information for the year ended December 31 of the current year McGraw Hill LLC All rights reserved No reproduction or distribution without the prior written consent of McGraw Hill LLC 5 3
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