Now that you have an awareness of the structure of the income statement and statement of financial position, it’s time to reinforce this knowledge and relate it to things which happen in the real world.
The video below introduces a spreadsheet model comprising 3 years of trading for a fictitious company, Big Air Toys. I would recommend that you watch the video and then download the spreadsheet using the link below.
You will notice that there are additional tabs / sheets in the workbook. These relate to topics that we will cover later.
When you have downloaded the file, may I suggest that, when changing one of the yellow cells, before you press enter, you try to predict which cells will change.
If you make changes to all of the yellow cells on the Year 2 and Year 3 tabs, you will have covered most transactions that occur in business.