Corporation
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a business owned by Shareholder (issue stock)
-Advantages: easy to transfer ownership (buy/ sell stock), easy to raise
money (issue stock), no personal liability
-Disadvantages: tough to start, double taxation.
Liability classifications
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, - Current and longterm
Balance sheet
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- Reports assets and claims to assets (liability) at a specific point in time
- Assets= Liabilities + Stockholder equity
- Assets first then liabilities and stockholder equity
- Assets- economic resources used to produce future benefit (items owned
or owed to us) in order of liquidity
- Liabilities - outsider claims and debts owed to others in order of maturity
- Stockholders Equity - Insider claims, ownership by stockholders
Intangible assets
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- Assets that do not have physical substance, such as goodwill, patents,
trademarks or trade names.
Faithful Representation
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- according to the FASB useful information should posses this
- means that information accurately depicts what really happened. To
provide a faithful representation, information must be:
o complete (nothing important has been omitted)
, o Neutral (is not biased toward one position or another)
o Free from error
Investing Activities
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- Purchase of resources a company needs to operate
o Buy/ sell PPE (equipment..)
o Investments are an example
Retained Earnings Statement
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- Represents the portion of the net income that the firm has kept (as
opposed to paying out in the form of dividends).
- ERE= BRE + NI - dividends
- If statement of stockholders equity then would include common stock:
ERE= BRE + common stock (owner contribution) + NI- dividends
Timely
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information must be available to decision makers within a specific
timeframe o appropriately make decisions
Give this one a try later!
a business owned by Shareholder (issue stock)
-Advantages: easy to transfer ownership (buy/ sell stock), easy to raise
money (issue stock), no personal liability
-Disadvantages: tough to start, double taxation.
Liability classifications
Give this one a try later!
, - Current and longterm
Balance sheet
Give this one a try later!
- Reports assets and claims to assets (liability) at a specific point in time
- Assets= Liabilities + Stockholder equity
- Assets first then liabilities and stockholder equity
- Assets- economic resources used to produce future benefit (items owned
or owed to us) in order of liquidity
- Liabilities - outsider claims and debts owed to others in order of maturity
- Stockholders Equity - Insider claims, ownership by stockholders
Intangible assets
Give this one a try later!
- Assets that do not have physical substance, such as goodwill, patents,
trademarks or trade names.
Faithful Representation
Give this one a try later!
- according to the FASB useful information should posses this
- means that information accurately depicts what really happened. To
provide a faithful representation, information must be:
o complete (nothing important has been omitted)
, o Neutral (is not biased toward one position or another)
o Free from error
Investing Activities
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- Purchase of resources a company needs to operate
o Buy/ sell PPE (equipment..)
o Investments are an example
Retained Earnings Statement
Give this one a try later!
- Represents the portion of the net income that the firm has kept (as
opposed to paying out in the form of dividends).
- ERE= BRE + NI - dividends
- If statement of stockholders equity then would include common stock:
ERE= BRE + common stock (owner contribution) + NI- dividends
Timely
Give this one a try later!
information must be available to decision makers within a specific
timeframe o appropriately make decisions
