ACCTG 101 Lecture Notes - Lecture 3: Financial Statement, Income Statement, Accounts Receivable
Document Summary
Goods for from supplier = inventory up and accounts payable liability up, i. e. a +130 = l + 130 + e. from shares (200 at each) = increase in asset (cash at bank) and increase in shareholders" equity account. E. g. enterprise"s cash, accounts receivable, inventory, land, property, plant, equipment at cost(ppe) etc . Prepayments (amounts paid in advance but benefits not yet received) E. g. patent, copyright, trademark, brand name, goodwill. Criteria: future economic benefit, control by the entity, past transaction giving entity control. Include existing obligations that will have to be paid in future. Estimated future warranty costs, long service leave [payments to employees. Criteria: present obligation, future settlement with sacrifice of future economic benefit. Include accrued expenses (incurred throughout year but not paid) An expectation to pay later is not a liability if the transaction bringing the benefit.
