BBS 301 Lecture Notes - Lecture 3: Deferred Income, Retained Earnings, Financial Statement

• School: Harvard University
• Department: Medical Sciences - Biological and Biomedical Science
• Course: BBS 301
• Professor: tom

Document Summary

Hand-in no additional sheets of paper; use the back of this quiz sheet if you need more space. If you would like your marked quiz returned, use pen rather than pencil for your answer. The following information is available on the financial accounts of abc corporation. depreciation interest. Notes: equity represents the sum of all of the accounting equity accounts (that is, share-capital plus retained earnings). You can presume that depreciation for tax purposes and for financial statement purposes is the same, and therefore, there is no deferred income tax or future income tax liability in this problem. Any incremental short-term borrowing undertaken by abc during 1998 was at the end of the year. Therefore, abc"s interest expense for 1998 is the interest rate on short-term debt times short-term debt at the beginning of 1998 (end of 1997). Alternatively, if instead, abc paid down any short-term debt during 1998, this was also done at the end of 1998.