Learn how to finish all the calculations to create a complete income statement and balance sheet that forecasts the next three years.
- [Instructor] I'm starting out in the exercise file…named 03 07 BS Begin.…We're just about done with this balance sheet.…I want to direct my attention to owner's equity…which is the last section in this balance sheet.…Two common equity accounts our common stock…and retained earnings.…You'll likely see these two line items…on most balance sheets as they're…pretty informative for investors.…Common stock reflects the amount of funding,…it generally stays the same from year to year…unless the business plans on issuing more stock…or buying back its own outstanding shares.…
For Richard's, let's imagine that it stays constant.…I'm going to go and fill that in in row 43…so everything's going to be 0.63 for all the projected years.…Now let's talk about retained earnings on row 44.…Retained earnings are earnings that have…well, been retained.…These earnings help the business finance future growth.…So for any given year, we can forecast retained earnings…by adding the amount of the prior year's retained earnings…to the current year's net income…
- Explain the four different types of financial statements.
- Distinguish between the types of moving averages.
- Determine a seasonal adjusted trend.
- Break down pro-forma financial statements.
- Identify cash flows, and what increased liabilities and decreased earnings generally indicate.
- Tell what a regression is.
- Outline the naive approach.
Skill Level Intermediate
Finance Foundations: Business Valuationwith Jim Stice1h 49m Appropriate for all
1. Finance Basics
2. Simple Financial Forecasting
3. Pro Forma Financial Statements
4. Projecting Cash Flows
5. Introduction to Regression Analysis
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