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15.515 Recitation 1 Agenda

Administrative items · TA name: · Email: · Office hours: Quick Review of Basic Accounting Concepts Problem Set # 1: New England Bicycle Security Co. Questions

15.515 Recitation 1: Review of Basic Bookkeeping Procedures

September 11, 2002 Page 1

Quick Review/Must Know!

4 Financial Statements 1) Balance Sheet · Assets = Liabilities + Equity · Current and Long Term Accounts · A company snapshot 2) Income Statement · NI (Net Income) = Revenue ­ Expenses + (gains-losses) · Prepared for a given period of time

15.515 Recitation 1: Review of Basic Bookkeeping Procedures

September 11, 2002 Page 2

Quick Review/Must Know!

3) Statement of Cash Flows · Reflects the changes in the Cash Account on the Balance Sheet · 3 sections: ­ Operating ­ Investing ­ Financing 4) Statement of Retained Earnings · Ending RE = Beginning RE + NI ­ Dividends

15.515 Recitation 1: Review of Basic Bookkeeping Procedures

September 11, 2002 Page 3

Relationship between 4 financial statements

Figure 2-7

(Pratt 5th edition, page 51)

15.515 Recitation 1: Review of Basic Bookkeeping Procedures

September 11, 2002

Page 4

Problem Set # 1: New England Bicycle Security Co.

1. Record the effects of the events on the BSE worksheet

ASSETS Event Cash = LIABILITIES & STOCKHOLDERS' EQUITY RE RE Explanation

Totals

15.515 Recitation 1: Review of Basic Bookkeeping Procedures

September 11, 2002 Page 5

Problem Set # 1: New England Bicycle Security Co.

3. Balance Sheet (12/31/2002) Assets

Liabilities and Stockholders' Equity

15.515 Recitation 1: Review of Basic Bookkeeping Procedures

September 11, 2002 Page 6

Problem Set # 1: New England Bicycle Security Co.

3. Income Statement (FY 2002) Revenue Costs and Expenses

Net Income

15.515 Recitation 1: Review of Basic Bookkeeping Procedures September 11, 2002 Page 7

Problem Set # 1: New England Bicycle Security Co.

3. Statement of Retained Earnings (FY 2002)

15.515 Recitation 1: Review of Basic Bookkeeping Procedures

September 11, 2002

Page 8

Problem Set # 1: New England Bicycle Security Co.

3. Direct Statement of Cash Flows (FY 2002): Cash provided (used) by Operating Activities

Cash provided (used) by Investing Activities Cash provided (used) by Financing Activities Increase (decrease) in cash balance

Beginning cash balance

Ending cash balance

15.515 Recitation 1: Review of Basic Bookkeeping Procedures September 11, 2002 Page 9

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Recitation 1.ppt [Read-Only]

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