Balance sheet equation : Assets = Capital + Liabilities

Balance sheet for XYZ Ltd as at 31/12/YY

ASSETS Non-current assets Property, plant & equipment Intangible assets - development costs, concessions, patents, trade marks and brand names. Investments - shares, loan stock, debentures, or straight loans. Current assets Inventories(Stocks) - raw materials, consumables, work in progress and finished goods awaiting sale Trade receivables (Debtors) - include amounts due under bills of exchange receivable (minus provision for bad debts) . Other current assets - money held on short-term deposit, pre-payment. Cash Total assets (#) EQUITY AND LIABILITIES Share capital - the nominal value of the shares issued Other reserves - share premium account, revaluation reserve Retained earnings - the amount of profit ploughed back or retained by the business. Total equity Non-current liabilities Long-term borrowings - finance leases, medium-term bank loans, long-term unsecured loan stock,debentures and Eurobonds. Long-term provisions - the estimated liabilities in respect of deferred taxation and other matters such as pension commitments. Total non-current liabilities Current liabilities Trade and other payables (or creditors) - amounts owing for goods already received, electricity bills owing etc., Accruals(provision for admini. Expenses, application money, marketing owing. Short-term borrowings - overdraft, bills of exchange payable. Current portion of long-term borrowings - Loans have to be repaid within one year. Current tax payable Short-term provisions - dividend payment Total current liabilities Total liabilities Total equity and liabilities (#)

X X X

X X X X X X

X X X X

X X X

X X X X X X X X

The amounts shown as (#) would be the same.

Income statement

Revenue Cost of sales Gross profit Other operating income Distribution costs - costs associated with sales, distribution and advertising , ( - pre-payment) + Dep.of vehicle. Administrative expenses - associated wages and salaries and directors remuneration, (+Accrual(provision)), Dep. Of office premises, (Rents, Rates & Insurance office) Operating profit Finance income - income from investments, (such as rent from property, interest on bonds, dividends from shares) and realised capital gains from the sale of assets (net of losses). Finance costs - payments made on loans. Profit before tax Tax expense Profit after tax Dividends paid Profit for the period attributable to equity holders of the company Earnings per share for profit attributable to equity holders

X (X) X X

(X)

(X) X

X (X) X (X) X (X) X X

Cash = cash as per B/S + Increase in creditors + Decrease in debtors - Purchase of fixed assets - Interest paid + Interest received + Sales - Div. Paid - Tax paid -

The cost of sales can be found as: Cost of stock sold: opening stock (+ purchases) - closing stock (+Wages and salaries of production staff) (+ Depreciation of non-current assets) - Pre-payment (+Provision for bad debt) (+Factory running costs) (+Manufacturing overhead) (+Rares & Insurance of factories)