BUS 251 Study Guide - Midterm Guide: Cash Flow Statement, Financial Statement Analysis, Deferral

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Double-analyzing transactions: profitability ratios, profit margin ratio, return on equity (return vs what money you have invested), return on assets: d. d. i. Use this figure to compare against previous years or competitors. A high number makes the investor more money: financial statement analysis, measures include: a. i. Bus 251 chapter 3 week3/4: trial balance is a summary sheet, adjusting journal entries: usually things that you have used up within the period, depreciation of capital assets a. i. Credit: accumulated depreciation (contra account: expiration of prepaid expenses b. i. Credit: prepaid insurance: accrual of interest c. i. Week 4 ch4: revenue recognition, specific criteria: a. i. Sale of goods: answer for each point a. i. 1. a. i. 2. a. i. 3. a. i. 4. a. i. 5. Risks and rewards of ownership have been transferred to the buyer. Seller has no continuing involvement or control over the goods. Economic benefits from the transaction flow to the seller. Amount can be reliably measured (you can issue the bill, say for hours) a. ii. 2.

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