Fin323
Terms
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- Accounting
- resports financial info to the user in a form useful for decision making.
- Finance
- uses accounting info for decision making.
- Balance Sheet
- Assets = Liabilities + Owner Equity
-
Assets =
Where Found? -
= Current + Fixed
Balance Sheet -
Current Assets
= & What are they? -
= Cash + Accounts Receivable + Inventory
Can convert to cash w/in (1) year. -
Net Fixed Assets
= & What are they? -
= Land + Plant + Equipment - Accumulated Depreciation
no anticipation of converting to cash w/in (1) year. Used to run business. -
Liabilities =
Where Found? -
= Current Liabilities + Long Term Debt
Balance Sheet -
Current Liabilities =
Used in what formula? -
Accounts Payable + Accruals + Short Term Debt
Liability -
Long Term Debt =
Used in what formula? -
= Bonds + LT Bank Debt + Mortgages
Liability -
Owner's Equity =
Found on what Statement? -
Preferred Stock + Common Stock + Retained Earnings
Balance Sheet -
Preferred Stock
Used in what Equation? -
Hybrid Securities
Owner's Equity -
Common Stock
Where does this $ come from?
Used in what Equation? -
Stock sold to the public,
$ initially raised goes in here
Owner's Equity -
Retained Earnings
Used in what Equation? -
Cummalative amount of reinvested profit over the life of the company.
Owner's Equity - Accounts Payable
- $$ borrowed from a supplier
- Accruals
- Services you have not yet paid for.