Basket wonders Income Statement Basket Wonders Statement of Earnings(in thousands) for Year Ending December 31, 19X3a Net sales s 2, 211 a. Measures profitability Cost of Goods Sold b1,599 over a time period. Gross Profit 612 b. Received, or receivable SG&A Expenses c 402 from customers EBITd s 210c Sales comm, adv Interest Expense 59 officers salaries, etc EBT f s 151 d Operating income Income Taxes 60 e. Cost of borrowed funds EAT s 91 f. Taxable income Cash Dividends 38 ncrease in RE 7-16 s- 53 g. Amount earned for shareholders
7-16 Basket Wonders’ Income Statement a. Measures profitability over a time period. b. Received, or receivable, from customers. c. Sales comm., adv., officer‘s salaries, etc. d. Operating income. e. Cost of borrowed funds. f. Taxable income. g. Amount earned for shareholders. Net Sales $ 2,211 Cost of Goods Sold b 1,599 Gross Profit $ 612 SG&A Expenses c 402 EBITd $ 210 Interest Expensee 59 EBT f $ 151 Income Taxes 60 EATg $ 91 Cash Dividends 38 Increase in RE $ 53 Basket Wonders Statement of Earnings (in thousands) for Year Ending December 31, 19X3a
Adjusting the Basic Sources and Uses Statement Recognize Profits and Dividends Change in retained earnings is composed of profits and dividends Source: Net Profit $91 Less Use: Cash dividends 38 (Net) Source: Incr,RE 53 7-17
7-17 Adjusting the Basic Sources and Uses Statement Recognize Profits and Dividends Change in retained earnings is composed of profits and dividends. Source: Net Profit $91 Less Use: Cash Dividends 38 (Net) Source: Incr., R.E. $53
Adjusting the Basic Sources and Uses Statement Recognize Depreciation and Gross Changes in Fixed Assets Change in net fixed assets is composed of depreciation and fixed assets Source: Depreciation 30 Less use: Add to fa 100 (Net) Use: Incr, Net FA. 70 7-18
7-18 Adjusting the Basic Sources and Uses Statement Recognize Depreciation and Gross Changes in Fixed Assets Change in net fixed assets is composed of depreciation and fixed assets. Source: Depreciation $ 30 Less Use: Add. to F.A. 100 (Net) Use: Incr., Net F.A. $ 70
Sources and uses Statement Sources Side) SOURCES 3 Funds provided by operations Net Profit $91 Depreciation 30 Decrease, Accounts Receivable 16 Increase, Long-Term Debt 77 Decrease, Cash Cash Equivalents 10 224 7-19
7-19 Sources and Uses Statement (Sources Side) SOURCES Funds provided by operations Net Profit $ 91 Depreciation 30 Decrease, Accounts Receivable 16 Increase, Long-Term Debt 77 Decrease, Cash + Cash Equivalents 10 $224
Sources and uses Statement (Uses Side) USES Dividends $38 Additions to fixed assets IIncrease, Inventories 80 Increase, Accrued Taxes Decrease, Notes Payable 5 224 7-20
7-20 USES Dividends $ 38 Additions to fixed assets 100 Increase, Inventories 80 Increase, Accrued Taxes 1 Decrease, Notes Payable 5 $224 Sources and Uses Statement (Uses Side)