ACC1000 Study Guide - Cash Flow Statement, Asset Turnover, Cash Flow
Document Summary
Do they need the information and do they have the power to get it. If they need the information and don"t have the power to get it then they are dependent users and the entity is a reporting entity. Benefit the cost of obtaining the data should not exceed the benefits of having the data: sales returns and allowances is a contra revenue account to sales. The normal balance of the sales returns and allowances account is debit. A contra account is used instead of sales to record the amounts of goods sold that are being returned: office supplies/ stationary supplies are prepaid expenses, statement of financial position. Current assets: cash and cash equivalents, trade and other receivables, inventories, other current assets. Non current assets: investments, plant, property and equipment, intangibles, other non-current assets. Current liabilities: trade and other payables, current tax payable, short term borrowings, other current liabilities. Non-current liabilities: long term borrowings, long term provisions, other non-current liabilities.
