Balance sheet

1.) What is substance over form and off balance sheet finance?

Expert Solution

Substance over form in accounting refers to a concept that transactions recorded in the financial statements and accompanying disclosure of a company must reflect their economic substance rather than their legal form. A transaction is an instance of an event that could alter the financial status of a business entity.

Off balance sheet financing is an accounting method whereby companies record certain assets and liabilities in a way that prevents them from appearing on their balance sheet. It is used to keep debt to equity and leverage ratios low, especially if the inclusion of a large expenditure would break negative debt convenants

Substance over form in accounting refers to a concept that transactions recorded in the financial statements and accompanying disclosure of a company must reflect their economic substance rather than their legal form. A transaction is an instance of an event that could alter the financial status of a business entity.

Off balance sheet financing is an accounting method whereby companies record certain assets and liabilities in a way that prevents them from appearing on their balance sheet. It is used to keep debt to equity and leverage ratios low, especially if the inclusion of a large expenditure would break negative debt convenants

Professor Nabeel answered 2 years ago

Balance Sheet You are evaluating the balance sheet for Cypress Corporation. From the balance sheet you...

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Balance Sheet

Balance Sheet 2014 2015 2014 2015 Cash $ 1,800 $ 2,100 Accounts payable $ 5,200 $ 3,900 Accounts receivable 7,300 6,400 Long-term debt 27,400 22,500 Inventory 10,200 12,300 Common stock 17,500 21,500 Net fixed assets 40,900 36,700 Retained earnings 10,100 9,600 Total assets $60,200 $57,500 Total liabilities and equity $60,200 $57,500 Income Statement Net Sales $73,900 Costs 58,600 Depreciation ...

3. Problem 3-11 (Balance Sheet Analysis) Balance Sheet Analysis Complete the balance sheet and sales information in...

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A. Compare and contrast the Balance Sheet of Colgate-Palmolive with the Balance Sheet of the City...

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Balance sheet accounts

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