BJ Services Company
BJ Services, a company which has experienced a recent increase in stock price, is a rapidly growing oil-field services company whose acquisitions have been financed by issuing stock. The case provides a balance sheet at September 30, 1995 and a statement of summary transactions that occurred during 1996. Students are asked to complete the balance sheet at September 30, 1996, and the income statement and statement of cash flows for the year ending September 30, 1996 using the summary transactions and the beginning balance sheet.
To avoid using T-accounts or debits and credits, the case can be taught using a spreadsheet template with accounts in the columns and transactions in the rows. The financial statements are derived from the completed template. This case has been used in introductory financial accounting courses and in executive education programs to illustrate the development of financial statements and particularly the differences between cash flows and accrual income.