Professional Documents
Culture Documents
Exercise 1-1Requirement 1
Haskins and Price Operating Cash Flow Cash collected Cash disbursements: Payment of rent Salaries Travel Utilities Net operating cash flow Requirement 2 Haskins and Price Income Statements Revenues Expenses: Salaries Utilities Travel Rent Net Income Year 1 $380,000 (200,000) (40,000) (50,000) (30,000) $ 60,000 Year 2 $440,000 (210,000) (40,000) (60,000) (30,000) $100,000 Year 1 $330,000 (60,000) (200,000) (50,000) (30,000) $(10,000) Year 2 $450,000 -0(210,000) (60,000) (50,000 $130,000
Requirement 3 Year 1: Amounts billed to customers Less: Cash collected Ending accounts receivable
Year 2: Beginning accounts receivable Plus: Amounts billed to customers Less: Cash collected Ending accounts receivable
Exercise 1-2
g
List A
List B
a. applying the same accounting practices over time b. record expenses in the period the related revenue is recognized c. concerns the relative size of an item and its effect on decisions d. concerns the recognition of revenue e. along with relevance, a primary decisionspecific quality f. the original transaction value upon acquisition g. information is useful in predicting the future h. pertinent to the decision at hand i. implies consensus among different measurers j. the change in equity from nonowner transactions
1. predictive value
Exercise 1-3
2. 3. 4. 5. 6. 2. 3. 4. 5. 6.
Exercise 1-4
The matching principle The historical cost (original transaction value) principle The full disclosure principle The realization (revenue recognition) principle The economic entity assumption 1. The periodicity assumption The historical cost (original transaction value) principle The matching principle The full disclosure principle The economic entity assumption The realization (revenue recognition) principle