FINC3015 Lecture Notes - Lecture 2: Dividend Policy, Longrun, Cash Flow Statement

• School: University of Sydney
• Department: Finance
• Course: FINC3015
• Professor: Angelo Aspris

Document Summary

Also known as net assets or book value. If all assets and liabilities are recorded at market value, then: (cid:1831)(cid:1869)(cid:1873)(cid:1872)(cid:1877)=(cid:1827)(cid:1871)(cid:1871)(cid:1857)(cid:1872)(cid:1871) (cid:1838)(cid:1853)(cid:1854)(cid:1864)(cid:1872)(cid:1857)(cid:1871) (cid:1828)(cid:1867)(cid:1867)(cid:1863) (cid:1853)(cid:1864)(cid:1873)(cid:1857) (cid:1867)(cid:1858) (cid:1831)(cid:1869)(cid:1873)(cid:1872)(cid:1877)=(cid:1839)(cid:1853)(cid:1870)(cid:1863)(cid:1857)(cid:1872) (cid:1853)(cid:1864)(cid:1873)(cid:1857) (cid:1867)(cid:1858) (cid:1831)(cid:1869)(cid:1873)(cid:1872)(cid:1877) Equity: the difference between asset and liability value that belongs to the owners. Due to difficulties in determining market values, accountants do not attempt this task, but simply seek to supply reliable (usually historical cost) information, leaving users to make the subjective adjustments required for a valuation. Balance sheet: a double-sided listing of the assets of the business (lhs) and the financing of these assets (rhs) at a point in time. Resources: cash, operating working capital; and, non-current assets. Funding: short-term operational liabilities, long-term operational liabilities, debt; and, equity. Assets: probable future economic benefits obtained or controlled by a firm that is the result of past transactions or events, e. g. cash, amounts owed from previous events, benefits acquired in past transactions (inventory, property, acquired intangibles) as assets.