Which of the following investing activities increase/decrease cash:

• Purchase fixed assets by issuing debt

• Sell fixed assets for cash

• Collect a loan

• Purchase equipment for cash

‘TRANSLATION-2’ POINT

►Translate the cash flow statement below into Russian:

Operating activities
Net earnings						Xxx
Adjustments to reconcile to cash provided by operations
	Depreciation and amortization					Xxx
	Net decrease in accounts receivable					Xxx
	Net decrease in inventory					Xxx
	Prepaid expenses					Xxx
	Accounts payable					Xxx
	Taxes and other liabilities					Xxx
Net cash provided by operating activities						Xxx
Investing activities
	Purchase of fixed assets					Xxx
	Acquisitions of businesses					Xxx
	Sales of businesses and property					Xxx
Net cash used for investing activities						Xxx
Financing activities
	Reductions of notes payable					Xxx
	Issuances of notes payable					Xxx
	Reductions of long-term debt					Xxx
	Net issuances of common stock					Xxx
	Cash dividends					Xxx
Net cash used in financing activities						Xxx
Net increase (decrease) in cash						Xxx

‘PUZZLE-5’ POINT

►Classify each term from the box under the appropriate heading:

land accounts receivable accounts payable

owners’ investment cash merchandise inventory

prepaid rent retained earnings plant and property

long-term debt intangible assets paid-in capital

depreciation loans receivable prepaid advertising

premium on common stock goodwill common stock bank overdraft income tax payable

Assets	Liabilities	Capital

‘PUZZLE-6’ POINT

►Fill in the blanks with the accounting terms from the box:

assets (4) liabilities (2) liability (2) capital (5) income (2) expense year or period balance sheet merchandise inventory note payable or promissory note

1. The accounting equation is ________________=_________________+__________________.

2. Items owned by a business that have monetary value are ______________________________________________________.

3. _______________________________ is the interest of the owners in a business.

4. Money owed to an outsider is a(n) __________________________.

5. The difference between assets and liabilities is ________________ ______________________________________________________.

6. An investment in the business increases _____________________ _________________________ and_________________________.

7. To purchase ‘on open account’ is to create a (an) ______________ ______________________________________________________.

8. The statement that shows net income for the period is known as the ______________________________________________ statement.

9. Two groups of items that make up the income statement are ______ ________________________ and __________________________.

10. Assets must equal _______________________________________.

11. Expense and income must be matched in the same _____________ ______________________________________________________.

12. Merchandise inventory appears as a(n) ______________________ in the ________________________________________________.

13. The only account figure that appears on both the income statement and balance sheet is _____________________________________.

14. A written promise to pay a creditor an amount of money in the future is known as ______________________________________.

‘SUMMARY’ POINT

►Translate the phrases below into Russian and make them stick in your mind:

1. fixed costs

2. variable costs

3. current/noncurrent assets or liabilities

4. start-up costs

5. running costs

6. breakeven point

7. calculate costs

8. contribution

9. financial statement

10. balance sheet

11. income statement

12. cash flow statement

13. accounts receivable/payable

14. owners’/shareholders’ equity

15. paid-in capital

16. retained earnings

17. cash and cash equivalents

18. inventory

19. long-lived assets

20. tangible/intangible assets

21. trademark

22. goodwill

23. a promissory note

24. notes payable

25. net revenue\earnings

26. deduct expenses

27. deduct expenses from revenue

28. fall/be due

29. convert to/into cash

30. buy/sell on open account

‘BATTLE’ POINT

►Team up with your classmate and start to develop your arguments about the following statements:

1. Financial accounting – that is what really does count. Management accounting is a waste of time.

2. What is cash flow statement for? Balance sheet and income statement are more than enough for accounting purposes.