TALLER COMPLETO: Elaboración del Estado de Resultados

How to Prepare a Financial Statement

Introduction to Financial Statements

• The video aims to explain the basic process of preparing a financial statement, specifically focusing on the income statement.

• It emphasizes that recording transactions is the first step necessary for creating financial statements, which includes generating a trial balance.

Importance of Transaction Records

• Proper accounting supports are essential as they provide evidence of economic events within a company, ensuring accurate transaction records.

• Once transactions are recorded, this information is used to create the trial balance, which serves as input for both the income statement and the financial position statement.

Structure of the Income Statement

• The income statement must include specific elements: the name of the financial statement, company name, and relevant period.

• The structure involves listing revenues and expenses in order to calculate net profit or loss based on defined categories.

Detailed Breakdown of Revenues

• The example provided uses data from January 1 to December 31, 2018. It highlights how important it is to specify time periods in financial statements.

• Revenue sources are identified through trial balance entries; sales revenue amounts are detailed alongside any returns or discounts affecting total sales.

Calculating Gross Profit

• Sales figures are adjusted by subtracting returns and discounts leading to net sales; this figure is crucial for calculating gross profit.

• Cost of goods sold (COGS) is then deducted from net sales resulting in gross profit calculations.

Expense Classification

• Expenses are categorized into administrative costs, selling expenses, and financial expenses. Each category's totals contribute towards determining net income.

• Specific expense accounts such as salaries and professional fees are examined closely for their impact on overall profitability.

Summarizing Total Expenses

• A systematic approach is taken when summing up various expense codes; similar codes should be aggregated for clarity in reporting.

• Examples illustrate how different types of expenses (e.g., legal fees and consultancy charges) contribute cumulatively towards total operational costs.

This structured overview provides an insightful guide into preparing an income statement while emphasizing key concepts related to transaction recording, revenue calculation, expense classification, and overall financial reporting.

Understanding Expense Classification in Accounting

Overview of Expense Codes

• There are two codes related to account 51, specifically for maintenance and repairs. The first code (45) pertains to maintenance and repairs of transportation equipment, while the second (20) relates to office equipment maintenance.

Additional Expense Classifications

• Another classification under code 51 is 95, labeled as "diversos." This includes items like stationery and photocopying supplies, with a balance of 700,000 pesos noted.

Administrative Expenses Breakdown

• The total administrative expenses amount to 11 million 390 thousand pesos. This figure is derived from analyzing various expense codes within the sales duration.

Sales Expenses Analysis

• For sales expenses, only two relevant codes were identified: 52 35 (advertising services with a balance in the trial balance) and 52 50 (installation services), which relate to electrical installations.

Total Income Calculation Process

• After summing up all sales-related expenses totaling approximately 220 thousand pesos, other income sources were examined. Code 4402 represents financial returns with a balance of 520 thousand pesos.

Calculating Operational Profit Before Taxes

Identifying Other Expenses

• Other expenses classified under code 54 include inventory deterioration with a reported balance of 230 thousand pesos. This information is crucial for determining pre-tax profit.

Pre-Tax Profit Calculation Steps

• To calculate operational profit before taxes, total income was established at approximately 54 million pesos minus the cost of goods sold (35 million), resulting in a gross profit of about 18 million pesos.

Detailed Formula for Profit Calculation

• The formula used involves subtracting total administrative expenses (18 million), sales expenses (21 million), adding other incomes (24 million), and deducting other expenses to arrive at an operational profit figure.

Tax Obligations and Legal Reserves

Tax Estimation Process

• Once operational profit before taxes is determined, it becomes necessary to estimate tax obligations based on Colombian law requiring a calculation of corporate income tax at a rate of 33%.

Legal Reserve Requirements

• Companies must also allocate a legal reserve calculated as ten percent of post-tax profits until reaching fifty percent of their capital stock.

Final Profit After Deductions

• After calculating taxes and legal reserves from the operational profit before taxes, the final net profit amounts to approximately three million eight hundred eighty-seven thousand three hundred pesos.

This structured approach provides clarity on how different expense classifications impact overall profitability calculations within accounting practices.

Financial Statement Preparation Insights

Importance of Key Data in Financial Statements

• The three data points discussed are essential for preparing the financial position statement; without them, it is impossible to balance the statement. This includes calculating production data and its distribution.

• It is crucial to include calculated figures such as current liabilities and legal reserves in the financial statements. These elements must be accurately represented to ensure a true reflection of the company's financial health.

Transitioning to Equity Section

• The net profit from the fiscal year will also need to be included in the equity section of the financial statement, highlighting its importance in understanding overall company performance.

• As we move forward with discussing the preparation of these statements, revisiting these key data points will be necessary for clarity and accuracy in reporting.