HRT 374 Lecture Notes - Lecture 2: Deferral, Current Liability, Financial Statement

• School: Cal Poly Pomona
• Department: Hospitality Management
• Course: HRT 374
• Professor: John Self

Document Summary

Major financial statement prepared at the end of each accounting period. Referred as a statement of financial position. Liquidity- measures the operations ability to convert assets to cash. How quickly you can sell something to make cash. Current ratio- current assets divided by current liabilities. Based on cost principle ( often does not reflect current values of some assets, e. g. property and equipment) Fail to reflect many elements of value to hospitality operations. Static nature= reflect the financial position for only a moment. Based on judgments= not exact, based on estimates. Non recorded assets: things not on the balance sheet. Report formats- group totals on the report form can show either that assets equal liabilities and owner"s equity or the assets minus liabilities equal oe. Accounts receivable (ar)- less than 30 days. You are receiving money, somebody owes you money but haven"t pay you back. Notes receivable (nr)- less than 30 days. Similar to ar, but more formal and legal.