Question

Assignment for Chapter 11: Components of Balance Sheet and Statement of Net Income

Refer to the Metropolis Health System (MHS) financial statements contained in Appendix 33-A. Use the MHS comparative Balance Sheet, Statement of Revenue and Expenses, and Statement of Fund Balance for this assignment. Create a table with the following MHS Balance Sheet components. List the name of each component and its amount(s) and list appropriate MHS financial statement of where you found it.

Current Liabilities

Total Assets

Income from Operations

Total Operating Revenue

Current Portion of Long-Term Debt

Interest Income

Inventories

Answer 1

The balance sheet, sometimes called the statement of financial position, lists the company’s assets, liabilities, and stockholders ‘ equity (including dollar amounts) as of a specific moment in time. That specific moment is the close of business on the date of the balance sheet. A balance sheet is like a photograph; it captures the financial position of a company at a particular point in time. The other two statements are for a period of time.

The balance sheet is a formal document that follows a standard accounting format showing the same categories of assets and liabilities regardless of the size or nature of the business. Accounting is considered the language of business because its concepts are time-tested and standardized.

Current Liabilities
Current maturities of long-term debt	10,000
Accounts payable and accrued expenses	20,000
Total Current Liabilities		30,000
Total Assets		10,000
Income from operations		80,000
Total Operating Revenue		180,000
Less current Portion of Long-Term Debt	10,000
Income from operations		80,000
Inventories-Supplies and Drugs	5,000