MGMT 1A Lecture Notes - Lecture 10: Income Statement, Weighted Arithmetic Mean, List Of The Shield Episodes
Document Summary
Cost of sales: product costs as well as any cost of transporting. Depreciation and amortization: straight-line method over the estimated useful lives of various assets. Income taxes: accounted for under asset and liability method. Revenue recognition criteria: revenue should be recognized only when earned and realized/realizable, revenue sources. Gains arising from the sale of assets. Non operating income: expense (or loss) recognition. Net income = revenues (gains) - expenses (losses) Wash sale: transaction that is nulli ed by its reversal or offset. Income statement basic format: all-inclusive approach: all changes in equity during a period, modi ed all-inclusive approach: excludes equity changes from non-owner sources. Components of income statement: single step [page 175, multi-step [page 176] Discounts and terms: quantity discounts: for purchasing various qualities, purchase discounts: early or prompt payment, credit terms: contains term of discount and invoice due date. Begging inventory + net purchases = merchandise available for sale = ending.
