Chapter 5 - Balance sheet and statement of cash flows. After studying this chapter, you should be able to: Explain the uses and limitations of a statement of financial position, identify the major classifications of the statement of financial position, prepare a classified statement of financial position using the report and account formats. | Prepared by Coby Harmon University of California, Santa Barbara Intermediate Accounting Intermediate Accounting Prepared by Coby Harmon University of California, Santa Barbara Westmont College INTERMEDIATE ACCOUNTING F I F T E E N T H E D I T I O N Prepared by Coby Harmon University of California Santa Barbara Westmont College kieso weygandt warfield team for success PREVIEW OF CHAPTER Intermediate Accounting 15th Edition Kieso Weygandt Warfield 5 Explain the uses and limitations of a balance sheet. Identify the major classifications of the balance sheet. Prepare a classified balance sheet using the report and account formats. Indicate the purpose of the statement of cash flows. Identify the content of the statement of cash flows Prepare a basic statement of cash flows. Understand the usefulness of the statement of cash flows. Determine which balance sheet information requires supplemental disclosure. Describe the major disclosure techniques for the balance sheet. After studying this chapter, you should be able to: Balance Sheet and Statement of Cash Flows 5 LEARNING OBJECTIVES Balance Sheet, sometimes referred to as the statement of financial position: Reports assets, liabilities, and equity at a specific date. Provides information about resources, obligations to creditors, and equity in net resources. Helps in predicting amounts, timing, and uncertainty of future cash flows. LO 1 Explain the uses and limitations of a balance sheet. Balance Sheet Computing rates of return. Evaluating the capital structure. Assess risk and future cash flows. Analyze the company’s: Liquidity, Solvency, and Financial flexibility. Usefulness of the Balance Sheet LO 1 Explain the uses and limitations of a balance sheet. Balance Sheet The terrorist attacks of September 11, 2001, showed how vulnerable the major airlines are to falling demand for their services. Since that infamous date, major airlines have reduced capacity and slashed jobs to avoid bankruptcy. United Airlines, Northwest | Prepared by Coby Harmon University of California, Santa Barbara Intermediate Accounting Intermediate Accounting Prepared by Coby Harmon University of California, Santa Barbara Westmont College INTERMEDIATE ACCOUNTING F I F T E E N T H E D I T I O N Prepared by Coby Harmon University of California Santa Barbara Westmont College kieso weygandt warfield team for success PREVIEW OF CHAPTER Intermediate Accounting 15th Edition Kieso Weygandt Warfield 5 Explain the uses and limitations of a balance sheet. Identify the major classifications of the balance sheet. Prepare a classified balance sheet using the report and account formats. Indicate the purpose of the statement of cash flows. Identify the content of the statement of cash flows Prepare a basic statement of cash flows. Understand the usefulness of the statement of cash flows. Determine which balance sheet information requires supplemental disclosure. Describe the major disclosure techniques for the balance sheet. After studying this
