Financial Statements: April Explained

In the previous segment, you saw how the operations in March translated into the financial statements of the pizza food truck business. 

In the upcoming video, our faculty member Marie-Lys will brief the operations carried out in April. 

Now that you have an idea of the operations carried out in April, use the excel file "The Pizza Food Truck Exercise", provided at the beginning of the session, and try to fill in the three financial statements based on the transactions given.

Now, let’s hear from our faculty member Marie-Lys as she debriefs the operations carried out in April and how it translates into the financial statements.

In this video, you saw that the sales and profits for April are higher than those in March. You also saw that the value of the truck has decreased due to depreciation, while the value of accounts receivable has increased. 

The total cash generated for April is negative as the cash at the end of the month is less than the cash at the beginning of the month. On further analysing the cash flow statement, you saw that the cash flow from operations is not sufficient to self-finance the investments, leading to a negative cash flow for the period.

But it is expected that the accounts receivable will be paid in the coming months, bringing the company back to a satisfactory level of operations. 

Overall, the pizza food truck has performed well in its four months of operations.

The following file shows the financial statements of the Pizza food truck business throughout the 4 months.