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devry acct304 week3 discussion




Question;Wee 3;Income Statement (graded);Students often refer to an income statement as the statement;that shows how much money a company has made. Money, by definition, is;something that is generally accepted as a medium of exchange or means or;payment. Keeping that definition in mind, an income statement is not a;measure of money, but rather it is a measure of net income (or loss);also known as profit (or loss). Select a publicly held company like Apple;Microsoft, IBM, Hewlett Packard, Home Depot (Note: do not select a company;already chosen by your classmate). Go to their website and select Investor;Relations and there you will find the company?s annual report. Provide the link;to that annual report and based on what you have read about income statements;in this chapter and in the Becker materials, tell us what you have learned;about the company from reviewing its income statement.;This section lists options;that can be used to view responses.;Q2;Cash-Flow Statement (graded);The Statement of Cash;Flows has historically given students a lot of heartburn, but it really isn't;that scary. A cash-flow statement, simply stated, reports the uses (where the;cash was spent) and the sources (where the cash came from) of cash during a;period. Let's start with a very simplistic set of facts. I run a CPA firm, and;I billed my clients $50K during the month of February. To earn that $50K, I;incurred $20K of wage expense and another $10K of overhead (rent, utilities;insurance, etc.). So I made $20K profit, right? So I am sitting pretty?;Not necessarily. What if I now tell you that $40K of my billings have yet to be;collected? And my E&O insurance carrier increased my premium and I had to;pre-pay $10K of premiums this month. How does my cash flow differ from my;profit? Will these transactions appear on my income statement? My cash-flow;statement?


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