ACCT 2220 Study Guide - Midterm Guide: Uptodate, Accrual, Main Source

• School: University of Guelph
• Department: Accounting
• Course: ACCT 2220
• Professor: Nouman Ahmad

Document Summary

Accounting equation: assets + liabilities + owners equity. Internal users: managers, employees who plan and organize the company (finance, marketing, human resources, and production departments) External users: don"t work for the company (investors, creditors and taxing authorities) Proprietorship: small business, operated by owner, unlimited liability. Partnership: similar to proprietorship except there more than one owner, formal contract, each partner has unlimited liability. Corporation: owned by shareholders, limited liability (public corporations distribute financial statements, private corporations don"t) Financing: borrowing cash or issuing shares (notes payable, long term debt) Investing: purchasing and disposing of long lived assets (plant, equipment) Operating: day-to-day operations (revenues, dividends payable, salaries payable) Income statement: reports revenues and expenses for a period of time: revenues, expenses, earnings before income tax (revenue-expenses, net earning. Statement of changes in equity: how much of the company"s earnings was distributed to you and other shareholders (through dividends: retained earnings (beginning balance, add: net earnings, subtract: dividends, retained earnings (ending balance)