BSM 200 Study Guide - Final Guide: Interest Rate Future, Balance Sheet, Asset Turnover

• School: Ryerson University
• Department: Business Essentials
• Course: BSM 200
• Professor: Mary Foster

Document Summary

The purpose of financial statements: provide snapshot of the performance of a company over a time period. Balance sheet: snapshot of how the company is doing; how much the company has (assets) and how much it owes (liabilities) at the end of the year /given period. Assets go on the left side, liabilities on the right. As long as assets > liabilities (have > owe), the difference is the owner"s equity. Both sides (assets and liabilities + owner"s equity) have to be equal. Income statement: records how much the company received (revenue) and how much it spent (expenses) during the year. A video of how a company performs over a period. First line aka top line records sales/revenue: direct costs/cost of goods sold (expenses e. g. raw materials) can be directly attributed to the # units sold. Subtract direct costs from revenue to get gross income.