This activity provides deeper understanding of balance sheet analysis by comparing balance sheets from two points in time. Review the following reading, which shows a restaurants two balance sheets from a year apart.:
Mariotti, S., & Glackin, C. (2013). Entrepreneurship: Starting and Operating a Small Business. (3rd ed., pp. 267-268). Upper Saddle River, NJ: Prentice Hall.
Look at the current assets in Exhibit 8-7 (p. 267) that shows two years of the restaurant’s operation. Consider the cash, which has decreased; consider the inventory, which has increased; consider the capital depreciations, which have increased, and evaluate how short term & long term liabilities are impacted by these changes.
Write a 300-word response to the following question(s)/prompt(s), include at least one APA-formatted citation/reference to a source from this lesson.
Respond to the question:
How is owners’ equity impacted by these changes?
Reference
Mariotti, S., & Glackin, C. (2013). Entrepreneurship: Starting and Operating a Small Business. (3rd ed., pp. 267-268). Upper Saddle River, NJ: Prentice Hall.