ACC 317 Paper 1 Project |Batter Up Financial
Statement Analysis
College of Business, Southern New Hampshire University
ACC-317: Intermediate Accounting
, A balance sheet is important to a business’s financials, of course there are other
important financial documents, but a balance sheet is forever, and that makes it extremely
important. This is a sheet containing Assets, Liabilities and Owners’ Equity (Kieso et al., 2022).
Batter Up holds $13,809.00 in incurrent assets, anchored by $5,463.50 in cash and $3,070.50 in
accounts receivable, which together provide strong near-term liquidity (Kieso et al., 2022).
Prepaid items total $3,600.00( $2,000.00 rent and $1,600.00 insurance), reducing upcoming
cash outflows but not available for immediate spending (Kieso et al., 2022). Merchandise
inventory (FIFO) is
$1,675.00, indicating modest stock levels relative to overall liquidity needs (Kieso et al., 2022).
Total current liabilities are $2,186.65 largely comprised of Accounts Payable at $1,750.00,
Wages Payable at $270.00, and Interest Payable at $166.65. There is no short-term debt
presented; the Notes Payable is classified as long term. Liquidity is strong: cash and receivables
alone are nearly four times current liabilities, and prepaids further reduce cash demands over
the next periods. Payables are modest and appear manageable given cash on hand. While not
part of current liabilities, the $10,000.00 long term liability of $10,000.00 for Notes Payable
although this leverage does not impair short-term liquidity but leaves a thinner equity cushion
overall (Kieso et al., 2022). Batter Up’s near-term financial position is solid, with substantial
liquidity relative to current obligations (Kieso et al., 2022). The company should maintain focus
on timely collections of receivables and mindful inventory management, while also considering
steps to strengthen equity over time given the reliance on long-term debt (Kieso et al., 2022).
Batter Up has $11,622.35 more in current assets than liabilities, which makes up working
capital (Kieso et al., 2022). This surplus exists to fund the cash conversion cycle by purchasing
inventory, paying wages and vendors, and collecting receivables without relying on emergency
borrowing (Kieso et al., 2022). Batter Up also has planned ahead with prepaid rent, which in
turn will reduce future cash needs (Kieso et al., 2022). Batter Up has further reduced future
stress with no near-term debt pressure. The $10,000 note is long term, which keeps short-term
obligations low and strengthens the coverage metrics (Kieso et al., 2022).
Statement Analysis
College of Business, Southern New Hampshire University
ACC-317: Intermediate Accounting
, A balance sheet is important to a business’s financials, of course there are other
important financial documents, but a balance sheet is forever, and that makes it extremely
important. This is a sheet containing Assets, Liabilities and Owners’ Equity (Kieso et al., 2022).
Batter Up holds $13,809.00 in incurrent assets, anchored by $5,463.50 in cash and $3,070.50 in
accounts receivable, which together provide strong near-term liquidity (Kieso et al., 2022).
Prepaid items total $3,600.00( $2,000.00 rent and $1,600.00 insurance), reducing upcoming
cash outflows but not available for immediate spending (Kieso et al., 2022). Merchandise
inventory (FIFO) is
$1,675.00, indicating modest stock levels relative to overall liquidity needs (Kieso et al., 2022).
Total current liabilities are $2,186.65 largely comprised of Accounts Payable at $1,750.00,
Wages Payable at $270.00, and Interest Payable at $166.65. There is no short-term debt
presented; the Notes Payable is classified as long term. Liquidity is strong: cash and receivables
alone are nearly four times current liabilities, and prepaids further reduce cash demands over
the next periods. Payables are modest and appear manageable given cash on hand. While not
part of current liabilities, the $10,000.00 long term liability of $10,000.00 for Notes Payable
although this leverage does not impair short-term liquidity but leaves a thinner equity cushion
overall (Kieso et al., 2022). Batter Up’s near-term financial position is solid, with substantial
liquidity relative to current obligations (Kieso et al., 2022). The company should maintain focus
on timely collections of receivables and mindful inventory management, while also considering
steps to strengthen equity over time given the reliance on long-term debt (Kieso et al., 2022).
Batter Up has $11,622.35 more in current assets than liabilities, which makes up working
capital (Kieso et al., 2022). This surplus exists to fund the cash conversion cycle by purchasing
inventory, paying wages and vendors, and collecting receivables without relying on emergency
borrowing (Kieso et al., 2022). Batter Up also has planned ahead with prepaid rent, which in
turn will reduce future cash needs (Kieso et al., 2022). Batter Up has further reduced future
stress with no near-term debt pressure. The $10,000 note is long term, which keeps short-term
obligations low and strengthens the coverage metrics (Kieso et al., 2022).
