>> Financial Accounting
Assignment: Setting up a Financial Statement
As a nonaccounting manager, you will examine your company's financial statements as well as the financial statements of other companies. You must be able to recognize differences in these statements and have a general understanding of the various accounts listed on each statement.
In this assignment, you will determine the nature of various financial statement accounts, using the example of Compnet International.
Note: You will apply your learning from this assignment to calculate ratios for Compnet in the discussion for this week.
Consider the following scenario for this assignment: You are a manager at Compnet and your CEO has asked you to break down the financial statements into categories of accounts so that you can analyze trends within the company.
Part I: Computations
Select the links that follow to download and review the financial statements of Compnet International:
As you create the new Excel worksheet, use the prepared financial statements of Compnet.
Complete the following:
• Create a horizontal trend analysis of the reported Compnet financial statements. This worksheet should list each financial statement (balance sheet and income statement in this order) on two Excel worksheets (one worksheet file).
• In column A, you would list each account on the statement (make sure you show the various categories of accounts).
• In column B and following, you would present the annual totals of each account with a monetary difference (absolute) column to compare one year to the next year and a percentage difference column.
• Therefore, for each of the two years reported, you will have Y1, Y2, Difference, and Percentage Difference columns. Your trend analysis must include three historical years. Therefore you need to compare Y1 to Y2 and then Y2 to Y3 (fiscal years 2012-2014).
Part II: Summary
After completing the computations on each of the three financial statements, provide a 1-page summary of the trends that you have observed. Describe the material trends by the category of accounts. Did that category of account increase, decrease, and if so by what amount and percentage. Remember to only discuss the major or material trends that you have observed.
Apply APA standards to citation of sources. Submit both parts 1 and 2 together and be sure to clearly label each part.