Accounting

Exercise 7-1

The total assets are $499,890.96. The total capital is $319,102.64. The net income for March is $25,065.04. The current month’s gross profit is $64,839.74. March’s total expenses are $67,877.13.

All of these numbers are very important to a company’s financial statements and are very useful for a company in order to figure out how the company is doing financially. The total assets allow a company to see what they have put money into or have obtained. The total capital lets the company see all the money that has been invested in the company, as well as how much income the company has made. The gross profit allows the company to see how much money they have made from sales, which are the sales minus the cost of goods sold. The total expenses of a company are how much the company had to pay to keep the company running, such as payroll, utilities and rent. All of this information is important because this is how the company can tell if they can make it another month, year, decade or more. All of these numbers can be obtained from the balance sheet and income statement.

Exercise 7-2

March’s net cash provided by operations is $34,936.57. The cash provided by operation’s year-to-date is negative $20,347.67. The cash balance for the end of the period for March is $32,060.92. The retained earnings’ balance at the beginning of the period was $189,037.60. The ending balance for the retained earnings is $214,102.64. These numbers are also important to a company’s financial statements and a company’s financial stability. Retained earnings are moneys invested into a company and this is important to have correct so the investors can see how and what investments are used. It is also important to the beginning and ending retained earnings’ balance to see how much more investments are put in or taken out. The cash provided by operations is important to see how much it takes to run the company and the year-to-date shows how much has been paid to run it up...