Reference no: EM131627356
For Week, please turn in the answers to the following questions:
1. Define the process of accounting.
2. What are the three major divisions in the accounting field?
3. What is the Fundamental Accounting Equation?
4. What is the purpose of a balance sheet? What are some examples of typical balance sheet accounts?
5. What is the purpose of an income statement? What are some examples of typical income statement accounts?
6. What is the purpose of a statement of cash flows? What are some examples of typical statement of cash flow accounts?
7. Based on the financial information below, develop a income statement and a balance sheet for Joe's-Fly-by-Night Oil company for the year ended December 31, 2015. Unless otherwise indicated, assume all information below is either for the year 2015 or as of December 31, 2015.
Accounts receivable......................................... $3,000
Accumulated depreciation................................. $12,000
Cost of goods sold.......................................... $4,000
Income tax expense......................................... $1,000
Cash........................................................... $10,000
Sales........................................................... $20,000
Equipment (gross)........................................... $27,000
Selling, general, & administrative expenses............. $3,000
Common stock (1,000 shares).............................. $7,000
Accounts payable........................................... $17,000
Retained earnings........................................... $13,000
Interest expense............................................. $200
Inventory..................................................... $17,000
Long-term debt.............................................. $8,000
Dividends declared and paid.............................. $600