Financial Accounting: An Integrated Statements Approach, 2nd Edition

Preface xiii

balance sheet retained earnings account as well as a revenue or expense account in the

income statement column.

The IFS spreadsheet highlights the integrated nature of how transactions affect the

financial statements. In addition, the IFS spreadsheet provides an effective tool for

summarizing transactions and facilitating student preparation of the financial state-

ments. An example of an IFS summary spreadsheet is shown below.

The financial statements can easily be prepared from the IFS summary spread-

sheet. The balance sheet is prepared from the last row of ending balances for the period.

FROM PAGE 59

FROM PAGE 67

Balance Sheet

Assets  Liabilities  Stockholders’ Equity

Notes Capital Retained

Cash  Land  Payable  Stock  Earnings

4,000 12,000 10,000 6,

5,500 5,

9,500 12,000 10,000 6,000 5,

Statement of Cash Flows

d. Operating 5,

Statement of

Cash Flows

Income

Statement

d.

Income Statement

d. 5,500 Fees earned

Balances

d. Fees earned

Balances

Exhibit 6

Family Health Care Summary of Transactions for October

Statement of Cash Flows

a. Operating 6,

b. Operating 3,1 80

c. Financing 1,

Increase in cash 2,

Statement of

Cash Flows

Income

Statement

Income Statement

a. 6,400 Fees earned

b.1,370 Wages expense

950 Rent expense

540 Utilities expense

100 Interest expense

220 Misc. expense

3,220 Net income

a.

b.

INTEGRATED FINANCIAL

STATEMENT FRAMEWORK

Balances, Oct. 1

a. Fees earned

b. Paid expenses

c. Paid dividends

Balances, Oct. 31

Balance Sheet

Assets  Liabilities  Stockholders’ Equity

Notes Capital Retained

Cash  Land  Payable  Stock  Earnings

5,100 12,000 10,000 6,000 1,

6,400 6,

3,1 80 3,1 80

1,000 1,

7,320 12,000 10,000 6,000 3,