Basics of Balance Sheet, Cash Flow & Income Statements

Basics of Balance Sheet, Cash Flow & Income Statements - Description

Replace with BFRDP logo. Balance Sheet #1. Cash Flow. Financial Snapshot. Financial Snapshot. Meeting Financial . Obligations. Good old fashion recordkeeping. Balance Sheet #2. Working Capital. Debt/Asset Ratio. ID: 170535 Download Presentation

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Basics of Balance Sheet, Cash Flow & Income Statements

Replace with BFRDP logo. Balance Sheet #1. Cash Flow. Financial Snapshot. Financial Snapshot. Meeting Financial . Obligations. Good old fashion recordkeeping. Balance Sheet #2. Working Capital. Debt/Asset Ratio.

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Basics of Balance Sheet, Cash Flow & Income Statements




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Presentation on theme: "Basics of Balance Sheet, Cash Flow & Income Statements"— Presentation transcript:

Slide1

Basics of Balance Sheet, Cash Flow & Income Statements

Replace with BFRDP logo

Slide2

Balance Sheet #1

Cash Flow

Financial Snapshot

Financial Snapshot

Meeting Financial

Obligations

Good old fashion recordkeeping

Balance Sheet #2

Working Capital

Debt/Asset Ratio

Net Worth

Working CapitalDebt/Asset RatioNet Worth

Income

Statement

(Profitability)

Statement of cash flow

(Sources & uses of money)

Commit This Diagram to Memory

Slide3

Balance Sheet as of [a single date] Consolidated Personal Business

Current Assets

Current Liabilities

Non Current Assets

Non Current Liabilities

Net Worth or Owner Equity

Current

Non Current

Net Worth = Assets - Liabilities

Slide4

Income Statement Structure

RevenuesGross Revenues (example: $500,000)Operating Expenses (example: $250,000)Depreciation Expenses (example: $ 50,000)Total Operating Expenses (example: $300,000)Diff. between revenue & Expenses is Operating Margin ($200,000)Financing ExpensesTotal Financing Expenses (example: $25,000)Net Farm Income from Operations $175,000

Slide5

Key RatiosFrom the Income Statement

Financial efficiency ratios come from the income statement. The following four categories are looked at as a percentage of gross revenues.

Operating expenses—50%

Depreciation expense—10%

Interest expense—5%

Net Farm Income—35%

Slide6

Key RatiosFrom the Balance Sheet

Working CapitalDebt/Asset RatioNet Worth

Green Paper—Balance Sheet Exercise

Benchmark Ratios

Slide7

Your Turn to Fill Out a Balance Sheet

Investing for Farm Families has a very user friendly balance sheet that has a personal balance sheet as well as a business balance sheet. On completion you will see a completed balance sheet and distribution diagram between personal and business assets.