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    07 Activity 1

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    jezrel mauricio
    The income statement would be the best financial statement for Shark Loans to use as the basis for deciding whether to approve Wendy Services' construction loan request. The plus of the income statement is that it shows an increase in net income from 250,000 in 200A to 550,000 in 200B, demonstrating the company's profitability and ability to repay loans. The minus of the balance sheet is that the company's liabilities have increased from 86,240 to 144,840, signaling potential cash flow issues. Therefore, based on the increasing profits shown on the income statement, Shark Loans should approve the loan request.

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    07 Activity 1

    Uploaded by

    jezrel mauricio
    127 views2 pages
    The income statement would be the best financial statement for Shark Loans to use as the basis for deciding whether to approve Wendy Services' construction loan request. The plus of the income statement is that it shows an increase in net income from 250,000 in 200A to 550,000 in 200B, demonstrating the company's profitability and ability to repay loans. The minus of the balance sheet is that the company's liabilities have increased from 86,240 to 144,840, signaling potential cash flow issues. Therefore, based on the increasing profits shown on the income statement, Shark Loans should approve the loan request.

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    The income statement would be the best financial statement for Shark Loans to use as the basis for deciding whether to approve Wendy Services' construction loan request. The plus of the income statement is that it shows an increase in net income from 250,000 in 200A to 550,000 in 200B, demonstrating the company's profitability and ability to repay loans. The minus of the balance sheet is that the company's liabilities have increased from 86,240 to 144,840, signaling potential cash flow issues. Therefore, based on the increasing profits shown on the income statement, Shark Loans should approve the loan request.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    127 views2 pages

    07 Activity 1

    Uploaded by

    jezrel mauricio
    The income statement would be the best financial statement for Shark Loans to use as the basis for deciding whether to approve Wendy Services' construction loan request. The plus of the income statement is that it shows an increase in net income from 250,000 in 200A to 550,000 in 200B, demonstrating the company's profitability and ability to repay loans. The minus of the balance sheet is that the company's liabilities have increased from 86,240 to 144,840, signaling potential cash flow issues. Therefore, based on the increasing profits shown on the income statement, Shark Loans should approve the loan request.

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    You are on page 1of 2

    GE1715

    P-M-I CHART

    Instruction: Respond to the scenario below by using the P-M-I Chart. Write your answers on the spaces
    provided.

     In the Interesting box, write down some facts about the specific financial statement.

    Scenario: Shark Loans received a request for a construction loan from Wendy Services Inc. This
    construction loan will be used for the building of their fifth branch in Pasay. The company submitted their
    statement of financial position and income statement. Help Shark Loans choose which financial
    statement they would use as a basis on whether they will accept or reject Wendy Services Inc.’s request.
    Refer to Page 2. Justify your decision.

    Response 1: Statement of Financial Position Response 2: Income Statement

    Plus Minus Plus Minus

    Interesting Interesting

    My Decision

    07 Activity 1 *Property of STI


    Page 1 of 2
    WENDY SERVICES INC.
    Balance Sheet
    December 31
    200A 200B
    Assets
    Cash ₱166,320.00 ₱332,640.00
    Accounts Receivable 119,350.00 59,675.00
    Office Supplies 5,775.00 5,775.00
    Prepaid Insurance 15,400.00 15,400.00
    Office Equipment 261,800.00 300,000.00
    Accumulated Depreciation 53,900.00 207,900.00 61,500.00 238,500.00
    Total Assets ₱514,745.00 ₱651,990.00

    Liabilities and Owner's Equity


    Accounts Payable ₱53,900.00 ₱107,800.00
    Salary Payable 9,240.00 9,240.00
    Unearned Revenue 23,100.00 27,800.00
    Total Liabilities ₱86,240.00 ₱144,840.00

    B. Sia-Ko, Capital 428,505.00 507,150.00


    Total Liabilities and Owner's Equity ₱514,745.00 ₱651,990.00

    WENDY SERVICES INC


    Income Statement
    December 31
    200A 200B
    Revenue:
    Service Revenue ₱600,000.00 ₱900,000.00
    Expenses:
    Equipment rental expense ₱200,000.00 ₱200,000.00
    Wages expense ₱90,000.00 ₱90,000.00
    Utilities expense ₱60,000.00 ₱60,000.00
    Total expenses ₱350,000.00 ₱350,000.00
    Net Income ₱250,000.00 ₱550,000.00

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