which-financial-statement-shows-the-financial-performance-of-the-company-on-a-cash-basis-a-balance-s

Question

Which financial statement shows the financial performance of the company on a cash basis?
A. balance sheet
B. statement of owner’s equity
C. statement of cash flows
D. income statement

Puneet Prajapati · Accepted Answer

So let&#x27;s understand the meaning of statement of cash flow. Okay, But before that, we will ride down that What type of statement are included in financial statements? Every type of entity, the bear. Financial statements for assessing the financial position as well as other positions of the entity. Okay, now I&#x27;m writing in the order. Okay. So, income statement? Yeah. Is the first statement which is prepared. Okay. Followed by that we have balance sheet. Okay. After that, we have statement of cash flow. Okay, So these three statements, however there are there is one. Also, there is one other statement also, which is prepared as a part of financial statements. But we are not discussing here because, you know, these these statements are the traditional segments which are used to be prepared as part of the patient of fantastic things. So what does the income statement do? Okay, it assesses the profitability. You can write down the notes, which I&#x27;m writing for future references. Okay. However, it is not mandatory. Okay, So the income statement enables the entity to assess the profitability situation of the company. Like like we prepare income statement on a year to year basis like how much profit or loss the company has generated from operating its main activities for which the entity has been established. Okay, so how much profit or loss has been generated from such activities? Okay, to the now, what does the balance you do? Balance sheet indicates the financial position. However, balance sheet is itself, you know, summarized very brief, summarised form of and produce financials. It will not give. It will not give any user the proper readability into summarized into detailed form. Okay, so that is why we use different types of statement to understand the balance sheet properly. Because balance, it is itself for very high level somebody. Okay, so balance sheet enables to enables an entity to understand it. Financial position. Okay, there this is where is the start? Statement of cash flows enables the entity to assess the financial position. That&#x27;s a good thing on a cash basis. Okay, Like the statement of cash flow is prepared to assess the financial position. Or we can say the cash flow position of the entity. Three types of activities are included in statement of cash flow. Okay. First one is operating activities. Operating activities are those for which the business has been established. Let&#x27;s suppose you are in business of construction business by construction houses, infrastructure like that. So operating operating activities will be considered as your construction activities, like whatever type of cash flow will be generated or paid into construction activities will be Yeah, will be considered in operating activities. Okay, any type of cash, but from construction business will be considered an operating activities, then other is investing activities. Okay. Investing activities. Yeah. The third one is financing activities. Okay, so we will understand these freedoms in later subject when we will face much advanced problems related to this casual statement. However, the portion has asked us at which of the following which of the following statement provide the cash flow position of an entity. So out of the out of these three, the last one the statement of cash flow, it provides the cash flow position of an entity. Okay. Like, it enables the entity to understand that how much cash flow is being generated by each of the activity. Okay. And how much of the cash is being spent on each of the activity? Okay, so then we will get to summarize form of cash flow position Okay of entity itself. Okay, so the correct choice solve our problem. Yes. See? Okay, you can go down sheet number one and number two as part of your notes for for future reference. However, that&#x27;s all for the solution. That is Choice E. Thank you.

Puneet Prajapati · Answer

Okay, so let&#x27;s understand the current solution. But before moving to the main solution, I will write down the humble names which is being boarded in financial statements. Okay, so next stock, So financial statements. So every day above entity is required to prepare the financial statements. Okay, Now, what happens when they did it prepares the financial statements, it prepares the falling come parents in the order in which I&#x27;m going to write. Okay, so income statement has a different purpose. Okay, Followed by that we have a different statement that is known as that achieved okay and floated by that VF statement off gas. Okay, now out off the out of these three, only the balance sheet. Only Bellingen will be able to assess the financial position often Entity. Now what is the financial position will understand it also so that you can get a clear idea that by every, you know, giving more focused. Oh, balance sheet. Okay, let&#x27;s it so let&#x27;s see. What is Van Ingen position like? And we&#x27;ve been their balance sheet. What happens here? The innocents I&#x27;m drawing the the recent form a 1,000,000,000 shapes OK? Do not confuse you. I&#x27;m drawing this because to make it more clear that why do we have it? Who says the financial position often end? Okay, no one owns. This is the dumb which the company has to pay off their creators. Okay? It&#x27;s like it&#x27;s like, alone. Okay, so I&#x27;m reacting to that A That could happen. So that would be a danger to us. Like because whatever. We have to pay a day just like my movie and professional, That&#x27;s time. But I think you didn&#x27;t know that our capital isn&#x27;t above investment. Okay, That has been made about the owner of the business, OK, And a safe side recovery was you covered it with throw systems and many more components that included in the SX. However, true analyzing these three domes, we can understand that there companies standing which can only be given by balance sheet in a semi wasteful. Okay, so our balance sheet explains the financial position of the entity. So what is the character is 40 problem then, which gives which statement gives the financial position of the company. Okay, it&#x27;s bellen ships of what is the correct choice? The correct choices. You Okay, so that&#x27;s all for our solution are. You can try Chief number one as well as to for your future reference. Okay, that&#x27;s all for dissolution. Thank you.

Puneet Prajapati · Answer

Okay, So let us understand the current solution, But before moving to the institution vigilance and understand the concept off religious statements. And how do we teach to the occupation of financial statements? Okay, let&#x27;s suppose we have Ah, business off. Setting radio gives. Okay. Okay. This is over business. OK, so whenever be sell, you begin to customer. Or more specifically, Children. What happens? It consists off to evens be sell video games to the beatings. Okay. The parents of the Children and the parents give us money back against the video gives. So they&#x27;re supposed to be up financial drawn. The chip often. Angel religion is a plan in action. Victor. Ricin Villas exchange off money against the goods and services. Okay. It is very, very well industry. Okay, now what happens in the business? There is a cities of transactions. Let&#x27;s suppose 100. Okay, So what happens? Who to get a clear idea that how many transactions has the the entity has entered with other entities or other persons? Okay, we need to record or those transactions. Okay. After that, we get a detailed summary that war type off transactions happened with veg entities. How much the amounts. How much the amounts of the transaction happened with entity And, like, Vice. Okay, that comes from the posting. So posting provides it. They&#x27;re detail. Somebody off transactions happened with them. Entity. Okay. And an entity or different types of amputees. After posting, we have some organization. Now at this immunization process. What happens? This dictated details. Memorization becomes very brief in this process, and this is done to trial ballots. You can know this diagram on your notebooks also. Okay. No. After moving to brief brief civilization, they Then finally, it comes to the financial statements. There be prepared balance sheet. First of all, we do not prepared Ben, and she&#x27;d be prepared Income statement then moved to balance sheet, then moved to statement of cash flows. Okay. And like rice, So this is the process. Okay. This is also loan as accounting cycle. This process is known as a camping cycle. The process off accounting in any type of organisation. Okay, So we have a business of video games and the process to record the transaction. Italy and off probation, orphanages, statements. A potion has Oz. Says what? Which of the falling is not included in the ban. Interesting. So for the information financial stake names will include First of all, it will include income statement. What is income statement? What is well in sheet? We will discuss Ben. We will face the problems allergic to sit concepts. And then you just take a note off it for the for the current solution. OK, then we prepare the balance sheet, okay? And it last beep. Very cash. Mr. Yes, Mr. Okay, that&#x27;s clear. So the potion disasters. Which of the following is not included in financial stickers? So the correct answer we can die from the from from about explanation we have made so far that make choices The statement off owner investments. Okay, that statement is not included in financial statements, so you can know down. So she&#x27;d one she toe on the in orders for back a revision. However Indian, we have a conclusion uncertain as correct choice says the Okay, that&#x27;s all for another solution. Thank you.

Puneet Prajapati · Answer

Okay, So we are doing the stag in Hendry. What is the meaning of it and looted expects. Okay, so in 20 is nothing. It is thieves all McKinney in. Okay, it is the law practice cheesed by business entity who put a bed finished course. Okay. I like to support Date is our That is a business on it. Always dealing in business, off selling for me. Chip, perhaps, like chairs and tables. And so for sex. And likewise. Okay, so he has to acquire Roma TDN. Okay? He has to be acquired. Rahmati, that people says such girls. Okay, now what happens? They never Then whenever I need business or any business or chases the inventory, Okay, What happens? There are new circumstances. 1st 1 is that for purchasing the 20. The business entity pays cash with a supplier. Okay. Against the chains, off material or in mentally on the supplier. Okay. And back bush in that cash to supplier will be considered in incomes to Okay, but let&#x27;s suppose we have a good relations with suppliers and supplier may allow credit off who? Three. Once the business. Okay from movie. A case of it in 20. Okay, so it will become our level. If you will not be the supplier immediately on purchasing off from material orange country, then it will become a liability. Okay, so it will be classy fighting that in sheet. Okay, so one once again, like the recluse circumstances and veep urges Elementary. Either we will a gastro supplies immediately the lock and we would pay later on in time. And that component will be classified in Bellingen. Okay, so that is what we have given in the current caution. Okay, we can also this liability. We can also we can also refer to it. That&#x27;s supplies. Okay. And this is supplies expense. So expense will be recorded income, statement and liability part because it is not a liability. It is just the inventor. Okay, so it will be classified in balance sheet. So that matches with Joyce. Hey, that is that engine. Okay, So supplies will be classified in bed, and she&#x27;s okay. That&#x27;s all part of a solution. However, you can write cheap mobile as well as she remembered on your load books for future reference. But answer will beat choice. Okay. Thank you.

Puneet Prajapati · Answer

Okay, So you are going to understand They don&#x27;t deposition, Okay? Little concepts. That How movie? The Gordie charging more in that position. Expense. Okay. The 1st 2 the amount off expense, most of the amount of experience that would be charged. Who comes who? The select beer and off a sect on yearly basis. Okay, so this definition shows that the deposition is an amount which is charged who income and income statement who show that baby is dearly the reason value of the asset, if you will use the except for of it production, Get a city. Okay, let&#x27;s suppose you have purchased the machinery on starting off your business, okay? To produce for nature processed Jaber air chairs and tables like that. Okay, so if you have purchased machine beyond first and very 2019 then let&#x27;s suppose you have purchased off $1000. So will actually remain same or the upcoming years. No, it&#x27;s not revenge. It will be decreasing. Okay. The value will decrease by that. So because it&#x27;s it will be used accordingly. Produced the for me. German. Did it hurt? Okay, so regard the deposition. We have first method that he will do like this. They record two types of entries. Okay, Their position, account epic. Who? A cynical. Okay. And it will be about this is the general in three. Okay, we have passed. Imaginative. So this is a direct entry to the court in that position, Like the deposition will be judged Do the respective, like machine three or any table for nature that is used for business purposes. Okay, so and it is a second mattered. And second method is used very because it very widely in the industry. And there&#x27;s a magnet off for security purposes. Basically. So that position account deputed to acumen into that position. Okay, so so in second method, what we have didn&#x27;t understand first method. Then they will face problems later, toe that however, we will understand. Second method. So it is the expense. It will be transferred to income statement. Okay. Like it down. This is the that. I don&#x27;t before shoot in second shoot for your difference. Okay? And I don&#x27;t do that. Precision expense will be transferred to incoming statement. Then I did actual profit and loss. Okay. However, a community that position will be shown in bed and cheap Okay, Now why do we use second method Will understand this. That&#x27;s first of all. See this? That gift their position expense is charged in first matter. Then I said value is also decreased by the proportionate amount. OK, but in second method, what happens? The assert is reflected and violent Shoot at the actual cost. And the person that it is an expense charge on the early basically transfer through the circle community deposition who see So the identity will be able to see that Helmand deposition expense. We have charged so on. Okay? And how much book value off A sets an actual cost of asserts via having like no one ever Belen. Shit. Okay, so that is right. Accumulator deposition will be transferred to that and cheat. Okay. And back matches that matches. So the solution matches with the choice A. Okay, so the correct choice is choice. Okay. Always you can write. She&#x27;d violent you do for your future reference. That&#x27;s all for our current solution. Thank

Puneet Prajapati · Answer

Okay, so you we are going to win this time about the dome shareholders OK? And rejected him. Analogies. Okay, these are go olders. Okay, owners up Corporation, full board shares certificate. Be sure by corporation. Okay. Income, which is active. You. It could be shared orders. Okay. So you can write down this technical definition. However, it is very before it in nature. In accounting. A subject the chair orders owners off she had holed up is a on their own company. Okay. Know what happens? Shade awarded deceives income act disposal Who? The share order and that income we can pull Certify that income who did it? Okay. And it will be It will be classified as diffident about We&#x27;ve been ok under the detain. The dean doesn&#x27;t statement. Okay? No, what we have in the statement in this statement they will prepare. That is the beginning. Balance off the retained earnings account. Okay, Followed by that the mill they will write down the profit generated for the Corinthia and results created out of that profit. Okay, for various time self purpose, like revaluation reserve capital reserves. We&#x27;ll give various types ofit deserves ask. But it would ideally glad makes. And at the end, off all the operations, after doing all the appropriations, we will have retained earnings balance at the end of DP. Okay. And out of those items, there is a I don&#x27;t actually know what between Os didn&#x27;t that this paper to a shareholder. So that so our matches with Joi sey Okay, that that this income will be active. Beautiful. Or we can say this income will be classified in retained earnings statement. So that matches with choice. See? Okay, that&#x27;s all for our solution. Thank you.

Problem

Which financial statement shows the financial pos…

Problem 15 Hard Difficulty

Which financial statement shows the financial performance of the company on a cash basis?
A. balance sheet
B. statement of owner’s equity
C. statement of cash flows
D. income statement

Answer

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Mitchell Franklin, Patty Graybeal, Dixon Cooper

Principles of Accounting Volume 1: Financial Accounting

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Principles of Accounting Volume 1: Financial Accounting

Mitchell Franklin, Patty Graybeal, Dixon CooperPrinciples of Accounting Volume 1: Financial Accounting

Mitchell Franklin, Patty Graybeal, Dixon Cooper

Principles of Accounting Volume 1: Financial Accounting