Question

In: Accounting

Write SFP if it is reflected on the Statement of Financial Position and SCI if the...

Write SFP if it is reflected on the Statement of Financial Position and SCI if the item is on the Statement of Comprehensive Income. There might be 2 possible answers.

1. Net Sale:
2. Total Current Assets:
3. Gross Profit:
4. Total Equity:
5. Net Purchases:
6. Ms. Solis, Drawing:
7. Mr. Trinidad, Capital:
8. Net Income/Loss:
9. Inventory Beginning:
10. Inventory Ending:
11. Freight In:
12. Petty Cash Fund:

Solutions

Expert Solution

We have to give answer regarding where those items will be reflected.  

FIrst we have to understand the word provided in question as SFP as Statement of Finacial Position.

Statement of Financial Position  in another word is Balacne Sheet .  

And same way Statement of Comprehensive Income is Income Statement which is indicated as SCI in question.  

We have been asked ,  where the provided data will   be rerflected either in SFP which is balance sheet or in SCI which is income statement.  

Ultimately we have to provide details regarding where ,   in balacne sheet it will be reflected or in income statement.

So lets start one by one.  

Before starting the question keep in mind  following two things very clearly .

A. Income and Expenses are always get Reflected in Income Statement or in Statement of Comprehensive Income ( SCI )

B. Assets and Laibilities are always get Reflected in Balance SHeet or in Statement of Financial Position ( SFP )

Now, lets start the solving the question by using above to fact of accounting .  

1. Net Sales : SCI

Net Sales is our income. and as per accounting rules  all the income are shown or  reflect in Income Statement. Due to that reason It will be reflected in Statement of Comprehensive Income.  

2. Total Current Assets : SFP

Total Current Assets are assets of the organisation. As per accounting rules assets always reflected in balance sheet in assets side. Due to that Total Current Assets will be reflected in Statement of Financial Position.  

3. Gross Profit : SCI

Gross Profit is always reflected in Statement of Comprehensive Income.  

4. Total Equity : SFP

Equity is liability of the organisation. Due to that same will be get reflected in SFP .  

5. Net Purchase : SCI  

Purchase is part of Expenses due to that same will be reflected in SCI .

6. Ms. Soil Drawing : SFP  

Ms. Soil Drawing is withdrawal of the owner from their capital  due to that same will be deducted from their capital. And Capital is always reflected under liability due to that drawing will get reflected in SFP .

7. Mr. Trindaal Capital : SFP  

Mr. Trindal Capital is balance sheet item. Same will be reflected liabiliy side of the balance sheet. Due to that same will reflected in statement of financial position.  

8. Net Income / Loss : SFP and SCI both  

Net Income / Loss will reflected in both balacne sheet as well as in income statement. Net Income / Loss derived from income statement has been transfered in balance sheet at the end of period. Due to that same has been reflected in both SFP and SCI

9. Inventory Begining : SCI  

Inventory of Begining is part of Income Statement . Same will be reflected in SCI .  

10. Inventory Ending : SCI and SFP Both  

Ending Inventory will get reflected in both SCI and SFP . In SFP it will reflected under current assets heading in assets side. And Same way also reflected in income statement.  

11. Freight In. : SCI  

Freight In is freight inward , it is a expense. Expense always reflected in income Statement due to that same will reflected in SCI.  

12. Petty Cash Fund : SFP  

Petty Cash Fund is current assets of the organisaion and assets are always reflected in SFP.

  

ekkarill92 answered 2 years ago
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