ACC* - Accounting ACC* M115 Lecture Notes - Lecture 4: Current Asset, Operating Margin, Asset

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Thus, we have these two contra- revenue accounts. Freight costs (hint: wherever the person paying isn"t indicates who pays) Shrinkage difference between book value & actual inventory *add this to your expenses. Financial analysis & interpretation 5: ratio of net sales to assets. Ratio of net sales to assets = net sales / average total assets (average total assets = average of beginning & end periods) Receivables all yr claims to other ppl"s money. Account receivable most common receivable; current asset; collected within a short period 30-60 days usually. Notes receivable formal, longer credit pd (60+ days). if expected to be collected within a yr, is a current asset. Other receivables interest receivable, tax receivable, receivables from officers / employees; reported separately on bal sht; if collection beyond 1 yr, called investments & are noncurrent assets. Uncollectible receivables customers may not pay accounts uncollectible . Factoring shift risk of receivables by selling them factor the buyer.

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