Class Notes (1,100,000)
US (470,000)
ND (2,000)
ACCT (100)
Lecture 10

ACCT20100 Lecture Notes - Lecture 10: Deferral, Retained Earnings, Promissory Note


Department
Accountancy
Course Code
ACCT20100
Professor
O' Tousa
Lecture
10

This preview shows pages 1-2. to view the full 7 pages of the document.
Accounting 21:13
Income Statement: Reports the accountant’s primary measure of
performance of a business, revenues less expenses during the accounting
period.
REVENUES- EXPENSES= NET INCOME
Revenues: Earnings from the sale of goods or services to customers.
They’re reported whether or not they have been paid for
If cash is received before the company delivers goods or services, the
liability account unearned revenue is recorded
If cash if received after the company delivers goods or services, an asset
accounts receivable is recorded
Expenses: Amounts a company incurs in order to earn revenue
EX: Cost of Goods Sold
If cash is paid before the company receives goods or services, an asset
account, prepaid expense is recorded
If cash is paid after the company receives goods or services, a liability
payable is recorded
Statement of Retained Earnings: accumulated net earnings minus
dividends paid owners, which represents the reinvestments in the core
business.
BEGINNING RETAINED EARNINGS + NET INCOME- DIVIDENDS=
ENDING RETAINED EARNINGS.
Balance Sheet: Reports the financial position of an accounting entity at a
particular point in time.
ASSETS= LIABILITIES+STOCKHOLDERS’ EQUITY
Assets: Economic resources with probably future benefits owned or
controlled by an entity as a result of past transactions
E.g. cash, inventory, supplies
Listed in order of liquidity (how soon it can be turned into cash or used)
Categorized as current (used or turned into cash within 1 year) and long-
term (non-current)
Accumulated Depreciation has a normal credit balance but it appears on the
balance sheet as an asset (CONTRA-ASSET)
Liabilities: Financing for the economic resources from creditors. Probably
debts or obligations that result from an entity’s past transactions and will be
paid for with assets or services.
E.g. Notes payable
Listed in order of maturity (how soon the obligation will be paid)
Classified as current or long-term
Stockholders’ Equity: Financing provided by the owners and by business
operations.
1
find more resources at oneclass.com
find more resources at oneclass.com

Only pages 1-2 are available for preview. Some parts have been intentionally blurred.

Contributed Capital and Retained Earnings
Statement of Cash Flows: all sources and uses of cash. Can’t fudge it!
Operating activities- cash generated by the company’s operations
Income Statement!
Current Assets, Current Liabilities, Interest and Taxes
Investing activities- cash spent on investments in assets
Investing and Property, Land, Equipment
Non-current Assets, notes receivable, short term investments
Financing activities- cash borrowed (and paid back) from long-term
creditors and sale of stock to owners.
Debt and Stockholders’ Equity
Non-current Liabilities, current notes payable, Contributed Capital and
Retained Earnings
Journal Entries
Assets = Liabilities + Stockholders’ Equity
Revenues Retained Earnings Contributed Capital
Expenses Dividends Net Income
2
find more resources at oneclass.com
find more resources at oneclass.com
You're Reading a Preview

Unlock to view full version