FINA2207 Lecture Notes - Lecture 1: Comprehensive Income, Net Income, Accounting Equation

• School: UWA
• Department: Finance
• Course: FINA2207
• Professor: Mahmoud Agha

Document Summary

Fina2207 chapter two notes- introduction to financial statements. Income statement: balance sheet, cash flow statement, statement of shareholders" equity. The balance sheet: the accounting equation: assets = liabilities + shareholders equity, shareholders equity = assets liabilities= net assets. Cash flow statement: cash from operations are cash from selling products or services, cash from investing is cash received and paid for productive assets, cash from financing is cash raised from or paid to equity and/or debt holders. Statement of shareholders equity: ending equity = beginning equity + total comprehensive income net payout to shareholders, where net payout to shareholders= dividends + share repurchases share issues. Footnotes and supplementary information to financial statements: details about items reported in the financial statements are usually reported in footnotes and supplementary notes. Include important items that may not be recognised in the financial statements. Intrinsic value is what the underlying security is really worth.