Professional Documents
Culture Documents
IIM Ranchi
Workshop for 2014-16 Batch
financeclub@iimranchi.ac.in
https://www.facebook.com/FinClub.IIMRanchi
Todays Agenda
Balance Sheet
Liabilities
+
Owners Equity
Accounts Payable :- Amount the firm owes to suppliers for good or services
purchased on credit
Notes Payable :- Short term debt obligations and current portion of long term debt
Accrued Liabilities :- Expenses that are recognized in the income statement but not
yet paid or contractually due. Examples include wages payable, interest payable,
taxes payable
Unearned Revenue :- Cash collected in advance of providing goods and services
Income Statement
Income Statement
Income Statement-Depreciation
Depreciation methods:
Straight-line: Equal amount of depreciation expense in each year of the asset's useful life.
SL depreciation expense = (cost-Residual value)/useful life
Declining balance: Apply a constant rate of depreciation to the declining book value
until
book value equals residual value.
DDB depreciation = ( 2/useful life) (cost - accumulated depreciation)
Outflows
- Cash paid to
- Cash paid for other
- Acquisition of trading
- Interest paid
- Resulting from acquisition or disposal of long-term assets and
- Taxes paid
certain investments
Inflows
- Sales proceeds from fixed assets
assets
- Sale proceeds from debt and equity
equity
- Principal received from loan made
to others
Outflows
- Acquisition of fixed
- Acquisition of debt and
- Loan made to others
Outflows
- Principal paid on debt
- Payments to reacquire
Examples:
shareholders
Purchase of building
Repurchase of common stock
Taxes paid
Dividends paid
Paid off long term borrowings
Profit on sale of building
Debt retired through issuance of common stock
- Dividends paid to
Amt ($)
Net Income
45
Depreciation
75
Taxes paid
25
Interest paid
Dividends paid
10
40
35
30
Purchase of machinery
20
Issuance of bonds
50
45
15
Amount ($)
120
20
Depreciation
25
Increase in inventory
10
15
2
Accounts Receivable
Unearned Revenue
Bonds Payable
Common Stock
COGS
Depreciation
Goodwill
Deferred Taxes
Dividends Payable
Gain on Sale of Assets
Prepaid Expense
Thank
You
Aman Vij
9608983826
Saurabh Jain
Viswajeeth Thippeswamy
+91+91-8404884578
+91-7762924663