Funds Type Statements
Self-Paced Overview
Classifying Changes
Example of Classifying Changes
In the Funds Statement example below, the cash account goes from $20,000 on the first, Beginning Balance Sheet to $5,000 on the second, Ending Balance Sheet. That is a decrease of $15,000. A decrease in an asset item is a source of funds. Other changes would be classified accordingly.
Funds Statement - Step 1
| Beginning Balance Sheet Products, Inc. |
||||
| Assets | Claims | |||
|---|---|---|---|---|
| Cash | $20,000 | Accounts Payable | $10,000 | |
| Marketable Securities | $10,000 | Accruals | $4,000 | |
| Receivables | $50,000 | Notes Payable | $24,000 | |
| Inventories | $70,000 | Long-Term Debt | $96,000 | |
| Fixed Assets | $160,000 | Common Stock | $64,000 | |
| Retained Earnings | $112,000 | |||
| Total Assets | $310,000 | Total Claims | $310,000 | |
| Ending Balance Sheet Products, Inc. |
||||
| Assets | Claims | |||
|---|---|---|---|---|
| Cash | $5,000 | Accounts Payable | $10,000 | |
| Marketable Securities | $10,000 | Accruals | $4,000 | |
| Receivables | $5,145 | Notes Payable | $0 | |
| Inventories | $32,250 | Long-Term Debt | $2,720 | |
| Fixed Assets | $172,000 | Common Stock | $64,000 | |
| Retained Earnings | $143,675 | |||
| Total Assets | $224,395 | Total Claims | $224,395 | |