Accounting Case Study/Analysis: Balance Sheet, Statement of Changes in Equity, Cash Flow Statement

Accounting Case
Study/Analysis

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
Question 1........................................................................................................................................1
a. Statement of balance sheet .....................................................................................................1
b. preparation of the change in equity statement and income statement ....................................2
c. Reasons for showing a leased asset in the balance sheet even in case the asset is not owned
legally..........................................................................................................................................2
Question 2........................................................................................................................................3
a. Framing cash flow using investing activities .........................................................................3
b. Preparing cash flow using financing activity .........................................................................4
c. Limitation of the cash flow statement ....................................................................................4
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
Accounting refers to the process of recording the financial transactions relating to the
business. The process includes recording, classifying, analysing, summarising and reporting the
transactions to internal and the external users. The present study is based on various aspect of
accounting that includes preparation of the financial statement that includes balance sheet, profit
and loss statement and the cash flow statement. Furthermore, treatment of leased asset is also
been described in the report with stating reasons of recording it as an asset on the balance sheet.
Moreover, limitations associated with the statement of cash position are also been highlighted in
the study.
Question 1
a. Statement of balance sheet
Balance sheet- It is been referred as financial statement that reports for company's asset,
shareholders equity and the liabilities for a particular period of time. It provides a base fro
computing the return rate and in making evaluation of company's capital structure (Williams and
Dobelman, 2017). It helps in depicting the financial position of an enterprise where all the
information regarding an owing of the company and an amount invested by the shareholders are
been taken into account.
Balance sheet
Particulars Amount Total amount
Liabilities
Non-current liabilities
capital 150000
less: Drawings 36000
114000
Mortgage payable 40000
Loan payable 20700
Total non-current liabilities 174700
Current liability
Accounts payable 37100
1