2- Part Accounting Homework

LP1 Assignment: Financial statements

Directions

In Part I, next to each item listed, you will identify which statement the item would appear. You will need to determine whether it would appear on the income statement (I), balance sheet (B), or statement of cash flows (CF). Then, for each group, explain the difference among the items listed. Finally, in Part II, discuss the relationship between the three financial statements.

Part I

Set 1:

_____ Inventory, ending balance

_____ Cost of goods (inventory) sold during the period

_____ Cash paid to suppliers during the period

_____ Accounts payable, ending balance

Difference:

Set 2:

_____ Accounts receivable, ending balance

_____ Cash received from customers

_____ Sales

Difference:

Set 3:

_____ Wage expense for the period

_____ Wages payable, ending balance

_____ Cash paid for wages during the period

Difference:

Set 4:

_____ Property, plant, and equipment, ending balance

_____ Cash paid for property, plant, and equipment during the period

_____ Cash received from selling property, plant, and equipment during the period

_____ Depreciation expense during the period (expense of using property, plant, and equipment during the period)

Difference:

Set 5:

_____ Notes payable, ending balance

_____ Cash received from borrowing money during the period

_____ Cash used to pay off notes payable during the period

_____ Interest expense during the period (expense of using borrowed money during the period)

Difference:

Part II

Discuss the Relationship between the financial statements identified: