ARBUS200 Lecture Notes - Lecture 2: Accounts Payable, Current Liability, Gross Margin
11 Dec 2016
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Pro forma does not adhere to the gaap (generally accepted accounting. Pro formas are used to illustrate projected numbers. Cost of sale or cost of goods sold not every company will have this. Gross margin (total revenue cogs = gross margin) Operating income = gross margin operating expenses. Net income = total revenues total expenses. Example: customer pays for a shirt, shirt costs is and, wages. In this case, your contribution margin is 50%, therefore, if your need to have sales of ,000/month to break even. 3 types of accounts: assets accounts receivable, money in the bank, inventory, equity (owner"s equity, investor"s shares, retained earning stock, liabilities (accounts payable, credit card balances, loan repayments) proceeds) Current assets - things expected to turn into cash within one year. Noncurrent assets - longer than one year to sell, includes fixed assets (property) Current liabilities obligations expected to pay off in one year.
